Preamble

The House met at half-past Two o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

Oral Answers to Questions — TREASURY

Endangered Species

Mr. Tony Banks: To ask the Chancellor of the Exchequer what plans he has to make additional resources available to Customs and Excise to combat trafficking in endangered species and products. [14169]

The Exchequer Secretary to the Treasury (Mr. Phillip Oppenheim): The control of endangered species is a priority, and one to which I give my strongest support. Customs has just increased the staffing of the specialist Convention on International Trade in Endangered Species enforcement team at Heathrow airport.
An important issue is to increase public awareness of the problem to prevent unintended imports. To that end, Customs and Excise—in partnership with the World Wide Fund for Nature and the Department of the Environment—is providing an endangered species video which most, although not all, of the airlines we have asked have already agreed to show in-flight, and I hope that others will follow suit.

Mr. Banks: First, I pay tribute to the work of Customs and Excise in trying to stamp out the trade in endangered species and wildlife products. I also thank the Minister for his commitment to the cause.
What specific resources are made available for the training of staff so that they can recognise the products that are coming in? Will there be an increase in specifically allocated staff? Clearly, the trade is now so large and growing that we need more people doing the job. The Minister referred to the CITES team at Heathrow. Will that model be extended to other airports, such as Manchester?
Finally, what is being done to stop the illegal importation of bear bile, rhino horn and tiger bone products, which are coming into this country for traditional Chinese medicine shops and are now available in London?

Mr. Oppenheim: The hon. Gentleman asked a number of questions, all of them important. Each of the 14 customs regions now has an expert CITES liaison and intelligence officer. The team at Heathrow—which has just been expanded to eight people—is the only

dedicated team, but all other customs areas are being given training and computer-aided recognition systems so that they can recognise snake skins and other products. We wish to increase resources in that area.
The hon. Gentleman mentioned Chinese medicine, and I agree that no nation can be complacent about this matter. In addition, no nation has an unblemished record on the issue. There is a particularly serious problem worldwide with Chinese medicines and aphrodisiacs. It is sad paradox that the most populous nation on earth sometimes seems determined to wipe out the last rhino because some of its menfolk seem incapable of performing. That is sad and ironic.

Mr. Harry Greenway: Reverting to a serious aspect of this important question, what is my hon. Friend doing—apart from providing manpower—to educate the public about the dangers of bringing in endangered species, as this seems to be the crux of the situation?

Mr. Oppenheim: The Government are developing a package of leaflets, posters and videos, with the help and support of wildlife and animal welfare groups. Almost all the travel agents and tour groups that we have approached have agreed to send these out with tickets, and to send posters to their reps abroad. Most of the airlines that we have asked have agreed to show the videos on their flights, including British Airways. The only major UK airline not to have agreed yet is Virgin Airways which, when reminded, said that Mr. Branson was currently too busy to respond.

Share Ownership

Mr. Bellingham: To ask the Chancellor of the Exchequer what steps he is taking to promote wider share ownership; and if he will make a statement. [14170]

The Financial Secretary to the Treasury (Mr. Michael Jack): In addition to the recent changes made to the three tax-approved employee share schemes, my right hon. Friend the Prime Minister has issued a challenging target to our largest businesses that he would like to see half their employees holding shares in their own companies by 2000.

Mr. Bellingham: Is my right hon. Friend aware that many of my constituents own shares in the companies for which they work and that many also own shares in privatised utilities that operate locally, such as Railtrack, British Telecom, British Gas and Anglian Water? Does he agree that those shareholders need confidence and that the one thing that would destroy that confidence would be a windfall tax which, apart from possibly being illegal, would amount to a straightforward confiscation of wealth from small shareholders?

Mr. Jack: My hon. Friend is right. If we follow what the shadow Chancellor said on the "Today" programme, it would be the equivalent of levying another 2p in tax. The shadow Chancellor's explanation on the radio this morning of the windfall tax was a cynical attempt to dodge the issue. He must have briefed the legal advice that he claims to justify it with all the details about the tax, so why does he not come out and tell the truth about which of the companies to which my hon. Friend referred


would be affected, how much would be raised and who would pay? My hon. Friend is right to postulate uncertainty about the tax.

Mr. Corbett: As the Minister made a plea for truth, will he tell us how the Government propose to pay for their share match scheme, which we are told is intended to spread wider share ownership? Will he give the House an assurance that it will not be done by extending value added tax on food, children's clothing, public transport, and so on? If he will give that undertaking, will he say where the money will come from to pay for it?

Mr. Jack: I would be happy to give a straight answer to that question, in contrast to the efforts of the shadow Chancellor to dodge any question about the windfall tax. The share match scheme requires a change in the regulation of an already existing mechanism in the approved profit-sharing scheme, and we are considering how precisely to achieve that.

Mr. Nicholas Winterton: Does my right hon. Friend agree that a windfall tax could be considered an increase in price for the vital necessities of life, such as gas, electricity and water? Will not the increase therefore bear down most heavily on pensioners and those on low incomes?

Mr. Jack: For the shadow Chancellor to smile at the conclusion of my hon. Friend's question shows his cynical disregard for pensioners, who would have to pay for the tax—which could cost households about £100 a year—but he will not come clean on it. My hon. Friend has exposed the Opposition's cynical attempt to raise money through a utilities tax.

Mr. Darling: Is it not clear that the Conservatives are not particularly bothered about pensioners, but are keener to climb into bed with the boardroom fat cats? Does the Financial Secretary recall that it was the Tory party that pioneered the windfall tax in 1981, and that the idea was supported by the chairman of the 1922 Committee? If the Financial Secretary is in the business of giving straight answers, can he confirm—given that stability, more than anything else, affects share ownership—that the Chancellor will meet his inflation target of 2½ per cent. by the end of this Parliament?

Mr. Jack: Let me say to the hon. Gentleman, who has just put up another smokescreen to dodge answering questions about the windfall tax, that it is not only fat cats who would have to pay: many pensioners and people on low incomes would be the victims of the windfall tax. The hon. Gentleman knows what my right hon. and learned Friend's target is; he is confident of meeting it.

Sir Sydney Chapman: Will my right hon. Friend confirm that not only shareholders but pensioners would suffer from the introduction of a windfall tax, because the fundholders of pension schemes invest heavily in the privatised utilities? Will he further confirm that the costs of the utilities for consumers are bound to go up in the event of a windfall tax, simply because, if the prices were too high now, the regulators would have intervened to force them down? [Interruption.]

Mr. Jack: My hon. Friend is right. Opposition Members scoff, but Professor Littlechild, the electricity regulator, told a Commons Select Committee that he would have to take into account the windfall tax and its effect on utility prices when prices came to be set in the future. There can be no stronger endorsement of the line that my hon. Friend took. All the speculation and concern of Conservative Members are the direct result of the cynical attempt by the shadow Chancellor to dodge putting on the record the information that he gave to Mr. Beloff, who is said to have provided a legal opinion justifying his tax. He should make it public and be answerable for it.

Value Added Tax

Ms Eagle: To ask the Chancellor of the Exchequer what representations have been made to him about recent levels of VAT receipts. [14171]

The Chancellor of the Exchequer (Mr. Kenneth Clarke): I receive a large number of representations on this and other subjects.

Ms Eagle: Will the Chancellor of the Exchequer explain how many times his Government have extended the scope of VAT and increased its rate since 1979?

Mr. Clarke: That would involve the history of many Budgets. The Labour party has committed itself to our spending plans. It has obviously belatedly come around to approving the Government's fiscal policy. As far as I know, it is making no commitments to reduce any tax. Instead, it proposes to introduce a windfall tax, about which it is singularly unable to answer any questions but which would add to the tax burdens of many households.

Sir Terence Higgins: On the collection of VAT and other Customs and Excise taxes, has my right hon. and learned Friend seen the article in the Financial Times the day before yesterday and the leader in the early editions of the Evening Standard yesterday that suggest that clauses 51 to 54 of the Finance Bill would make it possible for customs to take money direct and forthwith from bank accounts and, if people have no money in their bank accounts, from other people who owe them money? Is that story true? If it is, does he appreciate that that would not be acceptable?

Mr. Clarke: I, too, read the article in the Financial Times and the editorial of the Evening Standard, as did my colleagues. I discussed it with my right hon. Friend the Financial Secretary and my hon. Friend the Exchequer Secretary, among others. We are aware of the concerns and are considering them. I am not sure that I totally recognise the proposals in the newspaper reports, but I do not dismiss them.

Sir James Molyneaux: On the July capping of VAT refunds, will the Chancellor of the Exchequer give sympathetic consideration to the settlement of claims that had been accepted and promised before the announcement was made in July?

Mr. Clarke: We are carefully examining that. My hon. Friend the Exchequer Secretary will take a close interest in the matter. Where people were promised refunds in writing before July, I assure the right hon. Gentleman that we will honour those promises.

Mr. Garnier: My right hon. and learned Friend will have seen the posters put up by the Labour party advertising that the Government are to put up VAT on fuel. [Interruption.] I am glad that Opposition Members are listening. The mistake was mine. I meant VAT on food. Has my right hon. and learned Friend also heard that Labour proposes to abide by all our tax and spending plans? Does it follow that Labour advocates VAT on food?

Mr. Clarke: I very much doubt whether my hon. and learned Friend will get an answer to a question of that sort from the Labour party. I have no plans to impose VAT on food. I have never had any such plans. The Labour party knows perfectly well that I have not had any plans to impose VAT on food. The people who put up the poster did not believe it. The Labour party should advertise the answer to a straightforward question: will a windfall tax be imposed on British Telecom and on our telephone bills? We already know that it will be a tax on fuel, to go back to my hon. and learned Friend's slip of the tongue.

Mr. Malcolm Bruce: Will the Chancellor of the Exchequer acknowledge that his inability to forecast VAT receipts correctly is a significant factor in his inability to get borrowing down? Unless the situation has improved, does he accept that one way that would immediately help to bring down the cost of borrowing would be to make the Bank of England independent and, as a result, reduce the base of interest rates by between 0.5 and 0.75 per cent. and Government debt by £1.4 billion this year, according to the Library?

Mr. Clarke: First, estimates of VAT are always difficult. Treasury estimates have been going wide of the mark for some years, since about 1990. The hon. Gentleman will know that we set out the reasons for that in the Red Book. We have introduced measures to deal with many of them in the current Finance Bill, including a three-year cap on retrospective claims. We have also taken steps to improve collection. We have in hand the task of getting right the estimates of receipts, although it will always be difficult.
With regard to making the Bank of England independent, I believe that the present arrangements work extremely well. I find myself subjected to more debate than we used to have on the subject, because I made the process transparent by ending Treasury editing of the Bank's inflation report and by publishing regular minutes. The Governor and I are agreed that there is only a small difference of judgment between us—of one quarter of 1 per cent. He thinks that I put a little too much emphasis on the present strength of sterling and I think that he puts a little less emphasis on the strength of sterling than he should. We will continue to consider the matter. We are both confident that we will hit the target and maintain the best inflation record that Britain has had for 50 years.

The Governor's own forecast—the one that caused all the dispute—estimates that inflation will fall to 2¼ per cent. in the latter half of this year.

Sir Patrick Cormack: I revert to the question asked by my right hon. Friend the Member for Worthing (Sir T. Higgins). Will my right hon. and learned Friend go just a little further and give an unequivocal undertaking that the forecast in the Financial Times will never come to pass while he is Chancellor?

Mr. Clarke: We will have to consider what the Financial Times said. I have very high respect for that newspaper, but I will not sign up immediately to its assertions of what will follow. However, we are looking closely at those clauses of the Finance Bill and reflecting on the concerns raised in the Financial Times. Were those concerns fully borne out, we would wish to address them, but I do not want to concede the whole way until we have given more thought to them.

Mr. Gordon Brown: Will the Chancellor confirm that the commitments that he has just made on VAT on food were exactly the same commitments that the Prime Minister made on VAT on fuel in 1992 and then cynically broke? Given that VAT receipts depend on levels of spending and inflation, will the Chancellor repeat the commitment that he made before—that inflation would be at or below 2½ per cent. by the end of the Parliament? Will he repeat that promise, or is it yet another Tory broken promise?

Mr. Clarke: My recollection is that, at the last general election, a poster went up showing my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) dressed as "VAT man", in a Batman costume. The public were told by the then Labour spokesman, who did not believe a word that he was saying, that we had plans in the pipeline to increase VAT to 22½ per cent. A great deal of debate took place on that. Most of the quotations on which the Labour party relied were in response to a subordinate plot to that. It was a deceitful and incorrect campaign, which was never borne out by the facts.
Will the right hon. Gentleman take the opportunity to answer a straight question about a tax which he has told everyone he proposes to introduce in a few weeks, if he gets the chance? Will I and every household in the country face the consequences of a windfall tax if it is imposed on telephone bills and British Telecom?

Public Expenditure

Mr. Luff: To ask the Chancellor of the Exchequer what is the average public expenditure per head in (a) Scotland and (b) England in 1996–97; and if he will make a statement. [14172]

The Chief Secretary to the Treasury (Mr. William Waldegrave): In 1994–95—the last year for which figures are available—identifiable public expenditure per head was £4,505 in Scotland and £3,614 in England. This provision for Scotland is some 20 per cent. higher than the United Kingdom average.

Mr. Luff: In the event of the creation of a Scottish Parliament, it would have full control of public


expenditure in Scotland and could levy a tartan tax, while Scottish Members continued to be over-represented in this Parliament of the United Kingdom and could vote on English public expenditure and tax levels. How does my right hon. Friend think that I could justify that enormous differential to my constituents?

Mr. Waldegrave: With difficulty. The inevitable consequence of Labour's ill-thought-out plans, leaving aside the fact that they would be divisive between England and Scotland in many other ways, would be that the House would want to look at the basis of the financial deal between Scotland and England. There would be no way of stopping that, and it would not be to the benefit of Scotland.

Mr. Sheldon: Is the Chief Secretary aware that the Barnett formula, which was formulated by Lord Barnett, then Chief Secretary, when he and I were at the Treasury, was based on the population of Scotland? It was decided that it represented a fair allocation for the people of Scotland as a percentage of the total of Government expenditure throughout the United Kingdom. This is a serious matter. Is the Chief Secretary aware that, if we were to change that formula for any political considerations, it would cause serious danger to the unity of our country?

Mr. Waldegrave: I am very familiar with the formula, which is, of course, based not only on population but on an assessment and an attempted assessment of need. As I said to my hon. Friend the Member for Worcester (Mr. Luff), and it is a little odd for the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) to say it, it is the right hon. Gentleman's party, the Labour party, that is putting forward proposals that are liable to threaten the arrangements between England and Scotland. It is his party that is putting the Union in danger. One of the least of the consequences of those proposals—although an extremely important one to the people of Scotland—would be that people in England would want to look at the figures with increased attention.

Mr. Bill Walker: Does my right hon. Friend understand that Scottish Members, too, are equally concerned about what they can say to their constituents? As I understand it, the Barnett formula is designed to remove progressively and slowly the differences in expenditure levels between parts of the United Kingdom, particularly Scotland and England. The Labour party proposes to change that virtually overnight; we would be faced with what could only be described as the most unfair proposals ever brought before Parliament, because they would mean that Scots would be running the Westminster Parliament and making decisions on English spending matters, and Scots would be running the Edinburgh Parliament and making decisions on Scottish spending matters, but English Members of Parliament would not be able to influence either.

Mr. Waldegrave: My hon. Friend is absolutely right. I remember that, when I was Secretary of State for Health, my then opposite number, the current shadow Foreign Secretary, put that almost as eloquently as my hon. Friend has done; it has received no answer in the very badly thought out plans that the Labour party has since introduced. Those proposals would be disastrous for the Union, and also disastrous for Scottish taxpayers and for the standard of living in Scotland.

Mr. Mike O'Brien: Given that public expenditure on agriculture affects every taxpayer in England and

Scotland, will the Chief Secretary confirm that £3.3 billion, or the equivalent of 2p on income tax, is the sum needed to deal with bovine spongiform encephalopathy? Is that a minimum or a maximum figure?

Mr. Waldegrave: As far as I remember, the figures over two or three years are about £1.5 billion this year and then there will be a considerable refund from the European Union. The figures are set out and separately identified in the Red Book.

Mr. John Townend: Does my right hon. Friend agree that public expenditure per head in Scotland, particularly on health and education, is unfair to England and unjustified? Does he accept that, if there were a Scottish Parliament, many Conservative Members like me who feel strongly about public expenditure would campaign vigorously to bring the level of expenditure per head in Scotland down to the level in England? That would benefit English taxpayers.

Mr. Waldegrave: I will not go as far as my hon. Friend, because those matters are negotiated each year in relation to Wales and Northern Ireland as well as to Scotland. What I am saying, and what my hon. Friend has represented in his question, is that, if the Labour party's ill-thought-out, half-baked plans were to come about, there would be a huge reaction from England. That would be bound to damage the situation as my hon. Friend has described—it is only one of the matters in which the Union would be damaged, but it is one of the most important.

Value Added Tax

Mr. Alan W. Williams: To ask the Chancellor of the Exchequer if he will make a statement on the total revenue raised from value added tax in (a) 1978–79 and (b) 1995–96. [14176]

Mr. Jack: In constant 1995–96 prices, the receipts were £14.1 billion and £43.1 billion respectively.

Mr. Williams: Can the Minister say what the Chancellor meant when he said in the Budget statement on 30 November 1993 that one of his options
must be to extend the VAT base. The main candidates are food, children's clothes, transport, sewerage and newspapers"?
Is it not clear that, if we had another Conservative Government, just as the last one put VAT on heating, the next one would put VAT on food?

Mr. Jack: I am intrigued that the hon. Gentleman has chosen to ask me that question, when he could have asked my right hon. and learned Friend the Chancellor a little earlier. I also notice that he was reading in order to get accuracy. If he had read my right hon. and learned Friend's Budget speech in 1993, he would have seen that it is perfectly true that, in that context, my right hon. and learned Friend rather teased the House of Commons when he talked about his views on how we should have a broader tax base. He reviewed a number of possibilities and then went on to describe his own solution to broaden the tax base at that time. He introduced the House to the


concept of the insurance premium tax and the air passenger duty. At the end of his speech, he said to the House of Commons:
I can now confirm that I have no need this year to propose any changes to the VAT base."—[Official Report, 30 November 1993; Vol. 233, c. 940.]
The hon. Gentleman asked the question. He read his question for accuracy and I read the reply for accuracy.

Mr. Stephen: Does my right hon. Friend recall that, when we increased VAT to 17.5 per cent., the amount of that extra tax was refunded by way of subsidy to council tax payers? Does he also recall that, when we put tax on domestic gas and electricity, we fully compensated pensioners and people on low earnings by increasing their pensions and social security? Is he aware of any plans to compensate pensioners and people on low earnings for the consequences of a windfall tax?

Mr. Jack: My hon. Friend is entirely right to remind the House of the steps that we took to protect the interests of pensioners when we had to take difficult economic decisions as we were recovering from a very deep recession. We have now got the economy on track—we have the fastest-growing major western economy—and it is doing extremely well. That would be damaged by the arrival of the tax to which my hon. Friend refers and, as far as I am aware, we have heard nothing from the right hon. Member for Dunfermline, East (Mr. Brown) to tell us anything about the windfall tax, never mind about compensating pensioners.

Ms Primarolo: Does the Financial Secretary remember the Prime Minister's promise at the last election not to extend the scope of VAT? Does he also remember that, in his Government's pre-election Budget, the then Chancellor promised not to put VAT on fuel? Can he explain to the House why his Government broke those promises and why the electorate should trust them at all on any tax issue, particularly VAT?

Mr. Jack: My right hon. and learned Friend dealt very adequately with the question of VAT and the last election in his own very clear answer. However, I shall tell the hon. Lady because, when it comes to the economy, people should judge a Government not only on an individual item, but on whether they actually deliver. We have never hidden from the fact that putting VAT on fuel and power was a very difficult decision but, as my hon. Friend the Member for Shoreham (Mr. Stephen) reminded the House moments ago, we did help those who were most harshly hit, either through social security benefits or through direct help to pensioners. We have now delivered an economy that is the fastest-growing in western Europe, rapidly falling unemployment, the best inflation record for 50 years and the lowest mortgage rates for nearly 30 years. That is why people will believe us and not the Opposition.

Household Incomes (Tax)

Mr. Cash: To ask the Chancellor of the Exchequer what estimate he has made of the average percentage of household income directed to tax payments in (a) the United Kingdom and (b) other EU member states, in the most recent year for which figures are available. [14178]

The Economic Secretary to the Treasury (Mrs. Angela Knight): A family on average earnings

in the United Kingdom are expected to pay just over 35 per cent. of their earnings in tax next year. Although comparative figures are not available for other European Union countries, the overall burden of taxation on the economy in the United Kingdom, at 353/4 per cent. of gross domestic product last year, is one of the lowest levels in Europe and is below that of France, Germany and Italy.

Mr. Cash: Does my hon. Friend accept, first, that those excellent figures would have been even better, had we not spent so much on the disaster of the exchange rate mechanism; and, secondly, that we will never accept a Europe-wide tax system—unlike Labour Members, who are up to their eyes in the ERM the whole time, would take us back into it and would completely undermine the British economy?

Mrs. Knight: My hon. Friend is right to make those points about the strength of the British economy. I can assure him that the tax point to which he refers would be a matter of unanimity and that this country—this Government—will vote against that.

European Monetary Union

Mr. Sheerman: To ask the Chancellor of the Exchequer when he last met the German and French Finance Ministers to discuss the timetable for entry into European monetary union. [14179]

Mr. Oppenheim: Preparations for economic and monetary union are regularly discussed at meetings of the Economic and Finance Council. The last such meeting, which I attended on the Chancellor's behalf, was on 27 January.

Mr. Sheerman: Is the Minister aware that the Chancellor's weakness and vacillation are causing a great deal of concern in Europe about our commitment to Europe? Is he also aware that the leaders of major British businesses are concerned about their future, trading in a Europe with a common currency to which they do not belong? Is it not time that the Government and the Chancellor started running themselves, rather than allowing themselves to be run by right-wing Back Benchers who hate Europe and the ideal of Europe, despite the prosperity that it has brought us over 50 years?

Mr. Oppenheim: When it comes to vacillation, I seem to remember that new Labour has changed its policy on tax, on spending and on grammar schools. As soon as we changed our policy on Europe, it poodled along behind us. In fact, new Labour's unique selling proposition seems to be, "Those guys have made such a mess of things that we are going to copy all their policies."

Mr. Duncan Smith: When my hon. Friend next speaks to his counterparts in Europe, will he explain to them that the shadow Foreign Secretary's recent comments mean that if they do something, the Labour party will automatically follow them into the single currency on economic grounds? Will he explain to his counterparts that Conservatives approach the subject not


only as an economic issue but, as my right hon. Friend the Prime Minister said, as an issue with constitutional implications?

Mr. Oppenheim: Yes, my hon. Friend is broadly right. Any commitment to economic and monetary union would be the largest change in our economic affairs for many decades, but would not necessarily lead to political union. My hon. Friend can draw whatever conclusions he wants from that answer.

VAT (Domestic Fuel)

Mr. Winnick: To ask the Chancellor of the Exchequer if he will reduce VAT on domestic fuel. [14180]

Mr. Waldegrave: No. VAT was applied to domestic fuel for sound environmental and necessary revenue reasons, which continue to apply.

Mr. Winnick: Why not? Does not the Chief Secretary know that VAT on domestic fuel causes particular hardship to many pensioners and others on low income and should be reduced? But then a Chancellor who does not even know the price of a tin of baked beans would not worry about such matters, would he?

Mr. Waldegrave: It takes a certain nerve for a party—the Labour party—s that is making its centrepiece today a new tax on gas and electricity to complain about VAT on fuel. It is perfectly clear that the new tax on gas and electricity proposed by the Labour party will not only hit pension funds and shares, but is bound to affect prices. The hon. Gentleman has a brass neck to complain about VAT.

Mr. Yeo: Will my right hon. Friend confirm that old people were given full protection against the extra costs arising from the introduction of VAT on fuel? If the VAT rate were reduced, the benefits would go to the largest consumers of fuel, who tend to be the richest people. The proposal so enthusiastically espoused by the Labour party is a way to rob poor people and help rich people, while wrecking the environment in the process.

Mr. Waldegrave: My hon. Friend is quite right: pensioners, those on income support and others were fully compensated. My hon. Friend is also right that the bigger one's house, the more fuel tax one pays.

Mr. Milburn: Does the Chief Secretary agree with the statement made by the Chancellor in September 1993 that VAT on fuel is a perfectly fair tax?

Mr. Waldegrave: As the hon. Gentleman is a member of a Front-Bench team that proposes a new tax on gas and electricity, he should ask whether his so-called windfall tax is fair.

Mr. Ian Bruce: Has my right hon. Friend had time to read the literature put out by the Labour party and the Liberal Democrats at the last general election, proposing carbon taxes to put up the price of fuel because it was too

cheap? Has he seen what consumers are paying today for gas and electricity? Even with VAT, the cost of fuel has been reduced, owing to the Government's policies.

Mr. Waldegrave: The privatisations of the great fuel utilities, against which the Labour party voted on every occasion, have brought about a 2 per cent. real-terms decrease, after VAT, in the price of electricity and a 20 per cent. real-terms decrease, after VAT and everything else, in the price of gas. The Labour party opposed that, root and branch.

European Monetary Union

Mr. Ainger: To ask the Chancellor of the Exchequer if he will make a statement on the prospects for Britain being one of the initial participants in European monetary union. [14181]

Mr. Kenneth Clarke: I am confident that the United Kingdom will be able to achieve and sustain the convergence criteria of low inflation, low fiscal deficit and low public debt, and they will contribute to our policy of creating jobs and raising living standards in this country. At the moment, I believe that it is unlikely, although not impossible, that enough countries will be sufficiently convergent by 1 January 1999 for EMU to go ahead on that date. If EMU were to go ahead at any date without sufficient convergence, we would not be part of it.

Mr. Ainger: Does the Chancellor agree with the Foreign Secretary's view that joining EMU would mean a loss of sovereignty, or does he agree with the head of Toyota and the chairman of Unilever that failure to join EMU would mean a loss of jobs? Which is it? Which is his position, and who speaks for the Government on EMU?

Mr. Clarke: As the hon. Gentleman is well aware, the answer that I just gave is an impeccable statement of the policy that my right hon. and learned Friend the Foreign Secretary and I last gave together outside Downing street, and the policy is perfectly clear. All international engagements involve some pooling of sovereignty, and the political implications of any international engagement are a matter that the House and the public always want to discuss whenever such an event occurs.
As for the opinions of leading business men, they were not commenting on sovereignty; they were commenting, as they are entitled to do, on what they thought would be the implications for their businesses. I believe that both the gentlemen quoted are perfectly content with the Government's policy that we keep those options open, that we contribute to the evolution of policy and that we keep our eye on the ball, which is British jobs, British prosperity and the future well-being of this country.

Mr. Sweeney: Is my right hon. and learned Friend aware that the Allensbach Opinion Research Institute's most recent survey in Germany revealed that only 5 per cent. of Germans are wholly in favour of the euro, about 15 per cent. are mildly in favour and 80 per cent. are against? Does he agree that the most important convergence criterion that needs to be satisfied is the deficit in public support?

Mr. Clarke: I am not familiar with the Allensbach survey and I shall take the opportunity of catching up with


the figures. I doubt that people responding in Germany were concentrating on the key issues of British jobs, British prosperity and the well-being of UK Ltd. I hope that in this country we shall pay attention to British jobs and British prosperity to the same extent as German citizens pay attention, no doubt, to German jobs and German prosperity, when and if ever we have to take decisions on such matters.

Mr. Shore: The prospect of Britain joining the single currency on 1 January 1999 appears to be receding, and I think that we are all grateful for that. I know that the Chancellor is fastidious about the integrity of the convergence criteria. Will he make it plain that he will not accept the type of fudge that the French have gone in for by transferring telecom pensions against their 3 per cent. deficit, and will he also say that, if the Germans do hit the 3½ per cent. of GDP in their borrowing requirement this year, as it now appears that they will, he will exert himself to put a stop to other European countries joining a fudge currency on 1 January 1999?

Mr. Clarke: There is no point in commenting on whether the chances are advancing or receding on any of those things. We are pursuing a cautious and pragmatic approach based on our best judgment of British interests, ensuring that British influence is brought to bear on the evolution of policy, which is of great importance whatever happens to the future of the European market on which we so depend.
I agree with the right hon. Gentleman that accounting devices of the type that he describes and others should play no part whatever in such decisions. What matters is the underlying structural fiscal deficit that has been achieved by a specific country. What matters even more is whether a low structural deficit is likely to be sustained for the foreseeable future by that country, if it were to go into economic and monetary union. I assure the right hon. Gentleman that I shall continue to argue that point as strongly in the councils of Europe, in respect of all member states, as I have in the past.

National Income (Business Taxation)

Sir John Hannam: To ask the Chancellor of the Exchequer what is the proportion of national income taken in business taxation in (a) the United Kingdom, (b) in Germany, (c) in France, (d) in Italy and (e) as an average among European Union member states. [14182]

Mrs. Angela Knight: Organisation for Economic Corporation and Development estimates for 1994 show that the average EU tax burden on business is 10.6 per cent. of GDP. The tax burden for business in Germany is 9.4 per cent.; in Italy, 12.8 per cent.; in France, 16.8 per cent.; and in the United Kingdom, 8 per cent., one of the very lowest rates in Europe.

Sir John Hannam: I thank my hon. Friend for that illuminating reply. Does not it show that Conservative low-tax policies have helped to produce the most successful economy in Europe? Would not all that be ruined if the Labour party ever came to power, with a windfall tax, a minimum wage and the social chapter?

Mrs. Knight: My hon. Friend is correct. Our tax system has created jobs, whereas many of our European

partners have been unable to do so. It was interesting to learn this week of two companies that propose to leave France and come to Britain, simply because our tax burden is lower and the cost of employment in France, in particular, is so much higher.

Oral Answers to Questions — PRIME MINISTER

Engagements

Mr. Wilkinson: To ask the Prime Minister if he will list his official engagements for Thursday 13 February. [14159]

The Prime Minister (Mr. John Major): This morning, I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Mr. Wilkinson: Has my right hon. Friend had time today to study the reported comments of European Union Competition Commissioner Karel van Miert on the respective levels of state subsidy within the European Union? Did my right hon. Friend note that the United Kingdom has the lowest level of state subsidy per worker within the European Union and that the Federal Republic of Germany has the highest annual disbursement per year of any EU country? Is it not noteworthy that the UK now has the lowest unemployment for six years and that it is falling, whereas the federal republic has the highest unemployment for 64 years and it is rising? What deductions does my right hon. Friend make from those figures?

The Prime Minister: I have not yet seen the detail of what Commissioner van Miert said, but the conclusion, from what my hon. Friend says, is surely obvious. The fact is that state subsidies cannot hide the effect of high social costs. They add to the levels of taxation and, in so doing, they damage competitiveness and employment prospects. That is precisely what we have seen across continental Europe. It is a problem that we have avoided in the UK, which is why our unemployment is so much lower.

Mr. Blair: Will the Prime Minister confirm the following: first, that since last June when he promised that the beef ban would be lifted by last November, no part of the beef ban has been lifted; secondly, that under the selective slaughter scheme, not a single animal has yet been slaughtered; thirdly, that no formal proposal has yet even been put to the European Commission about lifting the ban from the BSE-free certified herds in Scotland, Northern Ireland and elsewhere; and, fourthly, that the cost of the BSE fiasco is now estimated at £3.3 billion and is currently running at £4 million a day?

The Prime Minister: If I may take the last point first, which deals with cost, I think that the right hon. Gentleman should be more careful about what he says about that. If he recalls, it was the hon. Member for Peckham (Ms Harman) who first tried to stoke up the health scare about British beef right across Europe, despite the fact that British beef is safer than continental


beef, and it was the hon. Member for Edinburgh, East (Dr. Strang) who supported the unjustified beef ban. I find the right hon. Gentleman's behaviour throughout the entire crisis absolutely astonishing. His behaviour would discredit a student debating society. Not once has he put the interests of the British beef industry in front of making petty party political points for his own party interests.

Mr. Blair: Four specific questions, not one specific answer—that is about par for the course. I remind the Prime Minister that he was not obliged to stand at the Dispatch Box last June and promise that he would lift the beef ban by last November, but he made the promise. He broke the promise—like so many of his promises. He made the promise, not because he thought he could deliver on it, but because, as usual, he was in a tight spot and wanted to get out of it. Let me just put one of those specific questions and allow him to answer it: is the Minister of Agriculture right when he says that the cost is now £3.3 billion, or, as he put it, the equivalent of 2p on the standard rate of income tax? Is he right, or is he wrong?

The Prime Minister: The cost is of that order. That is correct, and a substantial part of the reason for that is the health scares created by Opposition Members. Throughout the whole affair, the Government have been entirely open with the British nation, and the Labour party has repeatedly tried to stoke up health fears at home and abroad. If the Labour leader was really interested in restoring the British beef industry, he would be working with us to promote it, not undermining our position in the European Union just as we present plans on certified herds to the European Commission. But he is not interested in getting the ban lifted at all; he is interested in his own petty points.

Mr. Blair: Rightly has it been said that BSE also stands for "blame somebody else". The Prime Minister would do a lot more credit to his office if, just for once, when his Government make a mistake, he would accept responsibility for it. That he will not do so is one part of the reason why that fiasco will stand as a symbol of the incompetence of the most incompetent Government in living memory.

The Prime Minister: Even at this stage, the right hon. Gentleman takes the position of those who would do down the British beef industry. Before he does more damage to the British beef industry, he should reflect upon the damage that he has already done to it. It is British farmers and taxpayers who have helped pay the price for his posturing over the past few months. The bitter harvest has been reaped, partly because of the Labour party's domestic self-interest.

Mr. Elletson: Has my right hon. Friend seen recent reports in the West Lancashire Evening Gazette and The Express about a little girl of 11 in my constituency who has been addicted to heroin since the age of nine? Will he order an urgent inquiry into how Lancashire social services failed to notice that that little girl was in danger, despite the fact that eight members of her immediate family, including her granny, have been convicted of offences relating to the supply of heroin? Does my right hon. Friend agree that the case is an horrific example of the growing threat to children from drugs, and will he

reassure my constituents and the country that the Government continue to make the war against drugs a top priority?

The Prime Minister: I can certainly offer that assurance to my hon. Friend and the House. My hon. Friend highlights a truly tragic case, as he set it out. Although I am not familiar with all the details of the case, I was aware of it, and I understand that the director of social services in Lancashire is now reviewing the department's action, and that a report will be sent to the Department of Health's social services inspectorate, where we will examine it with great speed and great care. It is essential that, when a child needs protection, it receives protection from all the agencies concerned. On the evidence at present available—I emphasise that—it seems as though that may not have happened in that case.
On the more general question of drugs, as my hon. Friend is aware, the Government are deeply concerned about the problem of drugs and young people in particular. That is why the Home Office is currently supporting more than 1,500 locally based schemes on drug protection.

Mr. Ashdown: Surely the real issue is no longer the price that farmers have paid for one incompetent Minister, but the price that the country is paying for the whole squabbling herd of them. We are seeing rising inflation, the usual pre-arranged pre-election boost followed by the familiar post-election bust, sacked teachers, the health service plunged into crisis daily, and increasing class sizes. When will the Prime Minister realise that he has only one function left to perform that is of any interest to anyone: naming the day? When will he get on with it?

The Prime Minister: The right hon. Gentleman would be well advised to examine more carefully the litany that he recites. We have set an inflation target, which we shall meet, and which the right hon. Gentleman could only dream about. The average level of inflation under the last Lib-Lab Government was more than 15 per cent.—no wonder the shadow Chancellor dare not set an inflation target and tell the country what it is. He promises taxes, but he does not say who will pay them. He cannot tell us whether he would set an inflation target or what it would be. The right hon. Gentleman obviously has not seen today's annual economic report from the European Commission, which argues that we will meet our inflation target.

Sir Alan Haselhurst: Has my right hon. Friend carried out studies to establish how much a reduction in value added tax on domestic fuel from 8 per cent. to 5 per cent. would be outweighed by the impact on prices of a windfall tax on energy suppliers, which would possibly leave consumers worse off?

The Prime Minister: I would be very happy to carry out such an inquiry, if we were told who would bear the windfall tax and at what rate it would be levied. We are now told that the windfall tax is legal, but, despite the fact that Labour Front Benchers claim to be in favour of freedom of information, they will not release the information on which that assertion is based. I invite them to do so. I also invite the right hon. Member for Dunfermline, East (Mr. Brown) to tell us who would pay


the windfall tax and at what rate it would be levied. He could then tell the consumers of electricity, gas and oil precisely what that would do to their bills.

Mr. David Marshall: To ask the Prime Minister if he will list his official engagements for Thursday 13 February. [14160]

The Prime Minister: I refer the hon. Gentleman to the reply I gave some moments ago.

Mr. Marshall: Will the Prime Minister comment on the statement by the Employment Minister, the right hon. Member for Mid-Worcestershire (Mr. Forth), who admitted that only about half of the figures showing a fall in unemployment are genuine? Which half of those figures should we believe? As, at long last, a Minister has told us half the truth, will the Prime Minister inform us when just one Minister will tell us the whole truth and nothing but the truth?

The Prime Minister: My right hon. Friend said no such thing, as the hon. Gentleman knows. Opposition Members cannot bear the fact that unemployment is falling rapidly in this country, and has been falling for three years. There are now more people in work in each and every region.

Mr. Janner: Four million unemployed.

The Prime Minister: The hon. and learned Gentleman has not a single shred of evidence to support his claim. That is fiddling the figures on a scale that not even the hon. Member for Bolsover (Mr. Skinner) would contemplate. Unemployment is falling and people are in work. The hon. Member for Glasgow, Shettleston (Mr. Marshall) should recognise that fact. There has been a dramatic fall in unemployment in his constituency. He

should talk to his constituents who are now in work and who would lose their jobs under the policies that Opposition Front Benchers advocate.

Mr. Day: To ask the Prime Minister if he will list his official engagements for Thursday 13 February. [14162]

The Prime Minister: I refer my hon. Friend to the reply I gave some moments ago.

Mr. Day: Bearing it in mind that the new consensus in British politics seems to be based on the successful policies of 18 years of Conservative government, and given the fact that the Opposition have spent the past two years denying the previous 16 years and are now espousing all the policies that they voted against in the past, will my right hon. Friend inform the House and the country why the electorate should consider voting for the pale pink imitation opposite, when it has the real thing in the person of my right hon. Friend the Prime Minister?

The Prime Minister: My hon. Friend makes a very good point. After 18 years of Conservative government, we have low taxes, low inflation, more jobs and tumbling unemployment. The Labour party may adopt our rhetoric, but Labour Members do not believe what they say, and neither should anybody else.

Mr. Skinner: To ask the Prime Minister if he will list his official engagements for Thursday 13 February. [14163]

The Prime Minister: I refer the hon. Member to the answer I gave some moments ago.

Mr. Skinner: Is the Prime Minister aware that, once he has had the guts to go to the country, for the first time in his political life he will be sitting on the Opposition Benches? I have been keeping this seat warm for him. After the election, at least half a dozen Tory ex-Ministers will put the knife into him, because they want his job. Then he will have the galling experience of having to vote for one of those Tory bastards. Which one will it be?

The Prime Minister: The hon. Gentleman comprehensively removes the thought that one mellows as one grows older. A report earlier this week said that people do not get cantankerous as they grow older; they are born that way. Remarks like the one that the hon. Gentleman has just made were repeatedly put to me before the last general election. He is still sitting there; I am still sitting here. I look forward to congratulating him on his 70th birthday, and he will still be there if he holds his seat.

Business of the House

Mrs. Ann Taylor: May I ask the Leader of the House for details of future business?

The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): The business for next week will be as follows:
MONDAY 17 FEBRUARY—Opposition Day [5th Allotted Day].
There will be a debate entitled "The BSE Crisis" on an Opposition motion.
TUESDAY 18 FEBRUARY—Consideration of supplemental allocation of time motion relating to the Firearms (Amendment) Bill.
Consideration of Lords amendments to the Firearms (Amendment) Bill.
Remaining stages of the National Heritage Bill [Lords].
WEDNESDAY 19 FEBRUARY—Until 2 pm, there will be debates on the motion for the Adjournment of the House.
Motions on the Social Security Benefits Up-Rating Order, the Social Security (Contributions) (Re-Rating and National Insurance Fund Payments) Order, the Social Security (Contributions) Amendment Regulations, the Guaranteed Minimum Pensions Increase Order and the Social Security (Incapacity for Work) (General) Amendment Regulations.
THURSDAY 20 FEBRUARY—Debate on the constitution on a motion for the Adjournment of the House.
FRIDAY 21 FEBRUARY—The House will not be sitting.
Madam Speaker, the House will also wish to know that on Wednesday 19 February there will be a debate on future noise policy in European Standing Committee A. Details of the relevant documents will be given in the Official Report.
I regret that, once again, I am unable to give comprehensive information about the following week, but on Monday 24 February I expect to take Government business, including Second Reading of the Social Security (Recovery of Benefits) Bill [Lords]. The House may like to know that on Thursday 27 February I intend that we should have the annual debate on Welsh affairs on a motion for the Adjournment.
[Wednesday 19 February:
European Standing Committee A—Relevant European Community Document: 11419/96, Future Noise Policy. Relevant European Legislation Committee report: HC 36-xi (1996–97).]

Mrs. Taylor: I thank the Leader of the House for that information. He announced that on Thursday there would be a debate on the constitution. He will know from previous exchanges at business questions that we welcome such a debate, but can he tell us who will speak for the Government? Who will explain the many and varied statements of Government policy on devolution that have been made in recent days? Will the Secretary of State for Health participate in the debate, or is it true that he has been sacked from his role as co-ordinator of policy in this area?
May we have a debate on the inspection rights of the National Audit Office, in the light of the Government's refusal to allow the NAO access to the books of private companies that contract to provide Government services? The expansion of Government services provided by the private sector has been so extensive and so rapid that often there is no real check on the expenditure of huge amounts of public money. Does the right hon. Gentleman agree that, whether expenditure is in the private or the public sector, taxpayers' money should be properly accounted for, and the House should be able to ensure that that is the case? A debate might help in that regard.
Finally, will the Leader of the House find time before the general election for a debate on the collection and presentation of official statistics? There is widespread public scepticism about Government figures—scepticism that was reinforced yesterday by the admission by a senior Minister at the Department for Education and Employment that unemployment was a temporary phase because the Government had given the unemployment figures a boost in the short term, confirming what many people already knew.
It is no wonder that the public have no confidence in the Government's statistics. As Ministers claim to be anxious to debate various aspects of Labour party policy, may we make a bid for a debate, in Government time, on the need for an independent statistical service?

Mr. Newton: I shall take those questions in order. I anticipate that the Ministers speaking in the debate on the constitution will be the Secretaries of State for Scotland and for Wales, for obvious reasons. I shall consider what the hon. Lady said in her second question, but I assure her that the Government are always anxious for the National Audit Office to have the information that it needs in order to do its work—although other factors must be taken into account when that is being judged. As for the hon. Lady's question about official statistics, I echo what my right hon. Friend the Prime Minister said a few moments ago. There is a good deal more doubt about some of the exaggerated estimates of unemployment that we hear from Opposition Members than about any of the figures given by the Government when the signs of falling unemployment are so obvious.

Sir John Cope: My right hon. Friend has been very cautious in the last couple of weeks in responding to questions about the tax simplification procedure report from the Procedure Committee. Can he be more forthcoming this week? It is an extremely important matter, and I think that we ought to be getting on with it.

Mr. Newton: I acknowledge the importance of the matter, but I cannot go beyond the cautious sympathy, or sympathetic caution, in which I have engaged for the past two weeks.

Mr. Simon Hughes: I do not think it entirely obvious that only the Secretaries of State for Scotland or for Wales should speak in a debate on the constitution. There are constitutional matters for the United Kingdom. One of the oddities of the present Government, however, is that no one appears to be in charge of constitutional matters—no one, that is, except the Prime Minister.
May I, too, request a debate on statistics? I think that that would be valuable. More urgently, before the end of the Session, may we have a debate on an Adjournment motion about the future of Northern Ireland, which is still clearly a matter of huge concern and still not resolved? May we also have a debate on the housing projection of 4.4 million houses to be built over the next 25 years?

Mr. Newton: The hon. Gentleman has asked for no fewer than three debates in one or two sentences. I certainly cannot promise all those, but, obviously, as always, I will consider his representations.

Sir Patrick Cormack: While thanking my right hon. Friend for responding to the request that we have made for a debate on the constitution, may I ask him to think of the details again because what has been asked for is a debate on a substantive motion upholding the integrity of the United Kingdom? Perhaps a debate that the Prime Minister led on that wider issue would flush out some of the Opposition.

Mr. Newton: I very much agree with the thrust of my hon. Friend's concluding remarks. It certainly would be very desirable to, as he put it, flush the Opposition out in respect of their proposals on the constitution and I harbour hopes that the debate that I have announced will enable us to do that.

Mr. Andrew Faulds: In view of the immensely increasing dangers to peace in the Balkans, both between Turkey and Greece, in Albania, in Kosovo and in Cyprus because of the aggressive policies of the Greek-Cypriot Government, is it not time that the House of Commons had a real opportunity to debate these issues in depth—perhaps a two-day debate—before we go into the final seizures of this Government?

Mr. Newton: Without in any way dismissing the importance of the matters to which the hon. Gentleman adverts and in which he has long taken a close interest, I do not think that I can hold out hope for a two-day foreign affairs debate in the near future.

Sir Teddy Taylor: In view of the horrible killing yesterday of Stephen Restorick in Northern Ireland, which will achieve absolutely nothing for any purpose, but simply add to hatred and bitterness in Northern Ireland, might there be a case, unusually, perhaps next week, to have a short debate in which all the parties could express their respect and admiration for our armed forces, which are doing such a terribly difficult job in seeking to preserve security, and also their concern and respect for their parents, relatives, friends and all people associated with them?

Mr. Newton: While I cannot, to my regret, make an immediate undertaking to provide time for such a debate, I would like to associate myself with the thrust of my hon. Friend's remarks concerning our forces and the people of Northern Ireland.

Rev. Martin Smyth: I join the Leader of the House and the hon. Member for Southend, East (Sir T. Taylor) in that comment and sympathise with those relatives who are mourning today in this nation. At

the same time, I join the hon. Member for Southwark and Bermondsey (Mr. Hughes) in reminding the Leader of the House that Northern Ireland is part of this nation and therefore would like to be involved in the constitutional debate as well. Perhaps on that occasion it may be possible to know—as the Leader of the House is aware of my pressure for the Northern Ireland Grand Committee to have the same rights as the Scottish and Welsh Grand Committees—whether the period of consultations is ending and when the changes will be brought forward to effect the proposal.

Mr. Newton: I am grateful to the hon. Gentleman for his courtesy in giving me notice of this question. We are certainly seeking to complete the consultations as soon as possible and I hope that it will be possible to make progress.

Mr. Edward Gamier (Harborough): Will my right hon. Friend make time available at an early opportunity for a debate on the economy, not least on the question of employment, so that I can point out the huge successes in my constituency as a consequence of the Government's economic policies? Is he aware that unemployment is now down to an all-time low of 1,320, which is a 50 per cent. reduction over the period of this Government, since 1992? Will he urgently look for time for a debate that could bring out those points?

Mr. Newton: I shall certainly look for time for a debate that will help to bring out those points, although, I am glad to note, they are being emphasised in various ways: at Prime Minister's questions, on other occasions and through the remarks of my hon. and learned Friend. It certainly is a very good story that deserves to be fully set out.

Mr. Harry Barnes: In the debate on the constitution, we will presumably be able to discuss the most fundamental constitutional provision in the UK: the right to vote. In preparation, therefore, for the debate next Thursday, may we have information of just a basic nature on how many people are on the new electoral registers that will operate from this weekend? The Treasury and the Office for National Statistics have refused to provide that information, claiming that it will come forward only in April. April might be too late. We might be into an election by then. How many people have the vote out of those who are entitled to vote? That basic information should be available to us.

Mr. Newton: I shall certainly look into the point that the hon. Gentleman has raised.

Mr. Harry Greenway: May we have a debate next week on local government finance, because the good people of Ealing face a 10 per cent. increase in their council tax and a severe reduction in services from the ghastly Ealing Labour council? [Interruption.] Labour Members may laugh, but it is a serious matter. The people of Ealing will have to pay for the inefficiency of the Ealing Labour council, and I ask for a debate next week.

Mr. Newton: My hon. Friend will recall that we had a full day's debate on local government finance and the revenue support grant only a week ago, so I cannot promise an early opportunity. However, I wish my hon.


Friend well in defending his constituency interests, as he always does, and perhaps he might raise the subject in a Wednesday morning debate.

Mr. Peter Shore: With due respect to the Secretaries of State for Scotland and for Wales, the Leader of the House must recognise that a debate on the constitution should embrace Northern Ireland and England. That being so, will he ask the Prime Minister to consider whether he or the Deputy Prime Minister should take part in the debate next week?

Mr. Newton: I am sure that my right hon. Friends will consider the right hon. Gentleman's remarks with care, but there are only two slots in a debate and it is reasonable for the Secretaries of State for Scotland and for Wales to take part next week.

Mr. Rupert Allason: May I draw my right hon. Friend's attention to the disgraceful circumstances that surround the design of the euro notes? Is he aware that the euro notes that bear pictures of bridges, especially a bridge in India, have been copied from an English book, probably in breach of copyright? Is it not disgraceful that that has occurred and that Europe has covered up the problem? Will my right hon. Friend find time next week for a Government statement to give an undertaking to the British people that those particular notes will never be introduced as legal tender?

Mr. Newton: I was not present throughout Treasury questions, but my hon. Friend may have asked a question that he was not able to ask earlier because he did not catch your eye, Madam Speaker, although I do not suggest that your selection was not right and proper. I will bring my hon. Friend's remarks to the Chancellor's attention but, as my briefing states, the matter is not one for the Treasury or, indeed, the Government. The design of the euro notes and coins is the responsibility of the European Monetary Institute.

Mr. Alex Salmond: Why has the Secretary of State for Health been signed off for the debate on the constitution next week? Is it because, as we read in the papers, he has been sacked for blurting out the truth—there is no greater crime for a Tory Minister—or should we believe the story from 10 Downing street that it was a figment of our imaginations that he was appointed in the first place? Has he been sacked or is he a figment?

Mr. Newton: Whatever else, we may agree that the hon. Gentleman has a vivid imagination. We may also agree that if his question suggested that the Secretary of State for Scotland should not take part in the debate, that is interesting coming from that quarter.

Mr. David Shaw: Will my right hon. Friend make time for a debate on the appalling state of affairs in Deal in my constituency, where the Labour county council has threatened to close the library, has threatened fire service cover and has caused job losses without opportunities for job replacement, because the county councillor responsible for job replacement has been on 14 junketing trips abroad in the past three years?

Mr. Newton: Since we had a debate on local government in Kent only just over a week ago, my hon. Friend will

understand that I cannot give him an encouraging reply. I hope that my hon. Friend will find other ways to make his effective points.

Mrs. Alice Mahon: Is the Leader of the House aware that on 24 February there will be a lobby of the House by the victims of the Child Support Agency? In view of the chaos in the administration of that dreadful agency, may we please have a debate as a matter of urgency?

Mr. Newton: Such matters have been discussed at length by the House on several occasions, so I cannot promise an early debate. What I can say, as the hon. Lady knows, is that much effort has gone into improving the work of the Child Support Agency, and undoubtedly a significant improvement has taken place.

Mr. Geoffrey Clifton-Brown: May we have a debate next week on the subject raised by my hon. Friend the Member for Dover (Mr. Shaw)—that of Labour politicians such as councillors junketing around the world? We could then highlight the excesses outlined by the district auditor in Doncaster, where councillors were sent on free trips all round the world, and had so many business lunches and were said to have consumed so much alcohol that they could not stand up, let alone work. We would also be able to contrast the behaviour of the Doncaster councillors with that of the Leader of the Opposition, who travelled to the United States by Concorde on a free trip.

Mr. Newton: I have noted the various reports that have appeared in the press about such matters, and I fully understand my hon. Friend's concern. I hope that that concern will be noted by those on the Opposition Front Bench, as it appears to be a matter at least as much for them as for me.

Mr. Greville Janner: Did the right hon. Gentleman hear the Prime Minister saying today that there was not a shred of evidence that the unemployment figures were fiddled? Will he refer to early-day motion 525, which has been signed by more than 50 Opposition Members?
[That this House draws attention to the Government's fraudulent unemployment figures which ignore the latest Labour force Survey which shows unemployment about 302,000 higher than the Government's claimant count and further ignores the findings of the Employment Policy Institute that the number of jobless people who say that they want a job is well over four million, and not the 1.8 million registered by the Government's deliberately flawed claimant count; and calls on the Government to come clean on the true level of unemployment and the job insecurity and human suffering that unemployment causes in pre-election Britain.]
In the light of that information, should we not have a debate as a matter of urgency, so as to point out the disgraceful fact that there are more than a dozen exclusions from the claimant count? We could also make clear the need for an honest answer on the unemployment figures before the election, and an end to the lies that are presaging that election.

Mr. Newton: I have already observed to one of my hon. Friends that I see the attraction of a debate on


unemployment and other economic matters, because what will emerge from such a debate is not the sort of accusation that the hon. and learned Gentleman is chucking about, but the fact that Britain's success in having more people working and fewer out of work than any other major European country is one of the notable successes of the Conservative Government.

Mr. John Wilkinson: Will my right hon. Friend find time before this Parliament ends for a debate on the third report of the Select Committee on Social Security, which is about the uprating of state retirement pensions payable to people resident abroad? Is he aware that that is the theme of early-day motion 185, tabled by my hon. Friend the Member for Davyhulme (Mr. Churchill)?
[That this House expresses its grave concern at the discrimination practised by Her Majesty's Government against British state pensioners living in certain countries abroad; believes that the denial of pension increases to persons who have paid national insurance contributions is indefensible; and calls on the Government to end without further delay this discrimination against the hero generation who saved the world from Hitler.]
That early-day motion has attracted the signatures of no fewer than 248 hon. Members on both sides of the House. The Select Committee calls for a free vote in prime time on the matter, because there is clear discrimination against British citizens who have worked hard and paid a full stamp all their working lives, and who have gone abroad in their retirement, perhaps to join their children or grandchildren, only to see their living standards decline.
It would cost only £255 million a year to put right that manifest injustice. How can we ignore it, when £3 billion a year is wasted on social security fraud and £9 billion a year is made in contributions to the European Union, much of which is fraudulently misapplied?

Mr. Newton: My hon. Friend will be aware of the Government's increasingly successful efforts to counter the undoubted problem of social security benefit fraud. As for the main purpose of his question, I am aware that that controversy has continued for some time; it was going on when I was Secretary of State for Social Security. My hon. Friend talks about "only" £255 million a year, but he ought to acknowledge, as I hope that he will, that the Government need to think carefully about priorities, in view of the need to control the growth in social security spending as a whole.

Mrs. Jane Kennedy: The Leader of the House will recall that I asked him last week when the Secretary of State was to release the official figures for hospital waiting lists in England. May I remind him that we expected the figures to be released on 3 February, but, 10 days later, there is no sign of them? Does the Secretary of State propose to come to the House to make a statement on the figures? Since it became clear that the figures for the Royal Liverpool and Broadgreen hospital were being doctored, I have received correspondence from one Liverpool resident who has had his knee operation cancelled three times and who now knows that he will not figure on any official waiting list. Does he accept that while the Prime Minister may make

light of fiddling, no one else—certainly no Opposition Member—would agree with such abuses of official figures?

Mr. Newton: Perhaps I might simply make the point that my right hon. Friend the Secretary of State for Health is due to answer questions here next Tuesday.

Mr. Bill Walker: My right hon. Friend will be aware that many of us are delighted that we are to have a debate on the constitution on Thursday. Will he seriously consider tabling a substantive motion for the debate? The Prime Minister should speak in that debate, as we believe that it is important that the Leader of the Opposition should come to the Dispatch Box to explain to the House why his proposals to have Scots running Westminster, as well as Scots running Scotland, are fair to the 83 per cent. of the population living in England who will be faced with changes voted for by Scottish Members of Parliament who cannot vote on the same changes for Scotland. It is crazy, and it will break up the United Kingdom unless we stop it now.

Mr. Newton: I strongly agree with my hon. Friend that it is about time that we had clarification from the Leader of the Opposition of his proposals and their implications.

Mr. Bill Olner: Will the Leader of the House find time next week for an urgent debate on the continuing deterioration of the west coast main line, which runs through my constituency? I do not know whether the Leader of the House is aware of this, but Lord Archer was travelling to the Wirral today to make a keynote speech prior to the by-election. His train left Euston 40 minutes late and went slower and slower until Lord Archer had to abandon his trip at Nuneaton. Will the Government make sure that passengers on the west coast main line get to where they have to go on time?

Mr. Newton: I am naturally sorry to hear of my noble Friend Lord Archer' s unhappy experience, although clearly there is rather less sympathy among Opposition Members. In view of the experience recounted by the hon. Gentleman, I am sure that my right hon. Friend the Secretary of State for Transport will look carefully at the matter.

Mr. Bob Dunn: May we have an urgent debate on the implications of the social chapter for employment in my constituency—where unemployment is falling—so that we may talk about Germany, where the social chapter is applied and where unemployment increased by more than 500,000 in the month of December alone? It is important that people know the precise implications of the social chapter and the minimum wage.

Mr. Newton: That request, as my hon. Friend will realise, ties in with a number of others that I have received during these exchanges. I will bear his representations very much in mind, along with the others.

Mr. Jeremy Corbyn: The Leader of the House will be aware that I have raised the subject of the treatment of asylum seekers before. Will he find time for a statement or a debate about the number of asylum


seekers still held in British prisons, the number in Rochester prison who are still on hunger strike and the great difficulty that supporters and friends of those people are having in making bail applications to the courts to ensure that they at least have some degree of liberty? Is it not a disgrace that this country routinely imprisons nearly 1,000 people for doing nothing more than seek asylum, having fled from political oppression?

Mr. Newton: The hon. Gentleman knows that undoubtedly there have been abuses of asylum as a means of obtaining entry to this country, and that there is general agreement that it was necessary to take action on that front.
On the hon. Gentleman's actual question, I cannot promise a statement of the kind that he sought, but I can draw his attention to the fact that my right hon. and learned Friend the Home Secretary is due to answer questions this day week.

Mr. John Marshall: May we have an urgent debate on local government in London? I refer my right hon. Friend to an answer given by the Under-Secretary of State for the Environment, my hon. Friend the Member for Croydon, Central (Sir P. Beresford). It pointed out that outstanding rent and tax arrears amounted to £135 million in the London borough of Lambeth and £143 million in Camden; that in Hackney rent arrears were more than 30 per cent. of the annual rent roll, and 9.8 per cent. of council properties were empty; and that in Haringey rent arrears were 33 per cent. of the annual rent roll, and in Southwark more than 20 per cent.
Is my right hon. Friend further aware that in the London boroughs of Haringey and Islington arrears of council tax are such that the councils prefer not to tell the Chartered Institute of Public Finance and Accountancy what they are? Is not it an urgent situation, when the authorities claim that they do not have enough money and want more from the Government but refuse to collect what is due to them from their tenants and council tax payers?

Mr. Newton: My hon. Friend will recall that I have already made the point once today that it is not long since we had a debate on local government, which certainly would have embraced London, so I cannot promise another immediately. I regret that he evidently did not on that occasion have the opportunity to make the admirably succinct and effective speech that he has just made.

Mr. John Austin-Walker: The right hon. Gentleman will be aware that the Home Secretary is the police authority for London and that it has been customary to have an annual debate on policing in London. Does he recall the Prime Minister's pledge to provide resources to put an extra 5,000 bobbies on the beat, and is he aware that Londoners have lost 600 police constables and that the Home Secretary, in his capacity as police authority, has said that London has had its share of the additional resources but that he does not know where they have gone?
I draw the right hon. Gentleman's attention to early-day motion 527.
[That this House is concerned that Londoners face a 14.4 per cent. increase in the share of council tax which goes to meet policing costs in the capital; is horrified that the Home Secretary has described this as 'a modest increase', particularly at a time when the overall number of police officers has fallen by 649, of whom 599 were police constables; recalls that the Prime Minister made a pledge to provide resources to increase police numbers nationally by 5000; demands to know where London's share of those extra resources has been spent; is concerned at the transfer of the burden of the cost of policing from central government to council taxpayers; wishes to know why Londoners are being asked to pay more for fewer police officers whilst experiencing the worst crime clear-up rate in the country; and calls upon the Home Secretary, in his capacity as the Police Authority for London, to arrange for a debate on policing in London at the earliest opportunity before the Dissolution.]
In view of the remarks made earlier by the hon. Member for Ealing, North (Mr. Greenway), I draw the right hon. Gentleman's attention to the fact that London council tax payers will be paying 14.5 per cent. more for policing this year, for a lesser service. Will he therefore ensure that we have the annual police debate on London before Parliament is dissolved?

Mr. Newton: On the question of a debate, I shall ensure that that is added to what I sometimes call my list.
On the rest of what the hon. Gentleman said, I should perhaps make the point that council tax payers in London contribute only about 8 per cent. towards the cost of policing London, compared with an average contribution of about 12 per cent. elsewhere, and that in 1997–98 the spending power of the Metropolitan police will be £55 million more than in 1996–97.

Mr. Iain Duncan Smith: My right hon. Friend has announced a debate on the constitution for next Thursday, and he will know that last week and on other occasions I have pressed him for just such a debate. My concern is that he announced today that my right hon. Friend the Prime Minister would not lead the debate. He also said that he would accept and welcome the idea that the Leader of the Opposition should come and make clear his position. I put it to him that unless the Prime Minister speaks on behalf of the whole country—not only Scotland and Wales and my constituency in England—at the Dispatch Box, we will not have the opportunity to hear from the Leader of the Opposition exactly what the Labour party's policy is towards English electors as well as those of Scotland and Wales.
I urge my right hon. Friend to reconsider the position. The Prime Minister must come to the Dispatch Box and speak on behalf of the whole United Kingdom.

Mr. Newton: I cannot add to what I said earlier on the matter. As with other remarks that have been made this afternoon, I am sure that my hon. Friend's remarks will be carefully noted.

Mr. David Winnick: Why is the Leader of the House so coy about telling us the date of the Easter recess, and particularly the day on which, theoretically, we are due back, especially bearing in mind


the fact that for last Easter he gave the information the preceding November? Is it because he does not want to give the game away about when liberation day is coming?

Mr. Newton: I have not seen myself as being coy about that or anything else. The difficulties of giving advance notice of the Easter recess have been clear to everybody for a long time.

Mr. Tony Banks: Has the Leader of the House had an opportunity to watch the highlights of last night's England v. Italy World cup qualifying match? It would be a short programme and he could no doubt fit it into his busy day. Is he aware that the vast majority of the population were denied the experience, perhaps thankfully, because it was not available on a terrestrial channel? It was available only to Sky subscribers. May we have a debate on sport soon to discuss the growing concentration of sporting events being televised only by Sky, thus denying them to many people who want to watch our national games?

Mr. Newton: I did not have the opportunity of seeing either the highlights, or what the hon. Gentleman evidently regards as the rather larger lowlights of the match, because I was doing other things. As always with his questions, I am sure that my right hon. Friend the National Heritage Secretary will study them with the care that they deserve.

Companies (Payment Practice)

The Minister for Small Business, Industry and Energy (Mr. Richard Page): I beg to move,
That the draft Companies Act 1985 (Directors' Report) (Statement of Payment Practice) Regulations 1997, which were laid before this House on 27th January, be approved.
As the Minister with responsibility for small business, I am introducing the regulations, and not my hon. Friend the Minister for Competition and Consumer Affairs.
The regulations will help small businesses to gauge the fairness of the cash payment records of larger companies. Hon. Members will know that the problems caused by late payment continue to cause concern to small businesses. That was one of the major concerns highlighted last year, when we gave small firms the opportunity to shape future policies through the regional "Your Business Matters" conferences.
While there are no easy ways of tackling the problems caused by late payment, the Government are committed to helping small businesses. We have introduced a number of positive measures to tackle the problems associated with late payment. The regulations are another step along the way to helping small businesses to help themselves and to change the culture of payment practice.
In 1993, we consulted on a variety of possible ways in which payment performance could be disclosed in accounts. During the consultation, it became clear that the option of reporting payment policy and performance in the directors' report was supported quite strongly. In the light of that, we consulted again in February 1995 on that measure. As a result, in January last year, the Second Standing Committee on Delegated Legislation approved regulations requiring public limited companies and their private subsidiaries to disclose their payment policies in their directors' reports. That dealt with publication of payment policies.
However, concern continued to be expressed by small companies about the effects of late payment of commercial debt, most recently by delegates to the "Your Business Matters" conferences—the largest ever exercise in consulting small business, which the Prime Minister launched in 1995. He gave a commitment to act on every recommendation that "Your Business Matters" made. We returned to the issue of whether, and how, payment practice might be reported.
Before deciding on a method of payment performance, officials in my Department met a large number of interested parties, including a selection of large companies and small firms representative bodies, to test out possible methods of calculating payment performance. Our aim was to find a method that would not be too burdensome and that would be relatively straightforward for companies to produce and report in their annual accounts. Of all the companies that responded to the consultation, none identified any alternative preferable to the method proposed, and all were agreed that that option has the merit of being the least burdensome, as it is partly based on data that are already collected for accounts.
I come now to the details of the new disclosure requirement set out in the draft regulations. As I have already noted, we tried to find a straightforward way of stating payment performance, which provides useful


information in a readily understandable way. We could not require companies to put into their accounts details of the time taken to pay every invoice. That would not only compromise commercial confidentiality but impose an impossible burden on companies. Therefore, any figure will have to be based on some form of averaging.
The regulations will require companies to state the figure, expressed in days, which bears the same proportion to the number of days in the year as the amount owed to year-end trade creditors bears to amounts invoiced by suppliers during the year. It might be helpful to the House if I illustrated that by a practical example. Suppose that a company has purchased £100,000-worth of supplies during the year and has at the end of the year some £10,000 of trade credit outstanding. Trade creditors therefore represent 10 per cent. of the amounts invoiced. Ten per cent. of the number of days in the year is 36.5 days. So the company would have to disclose that figure in the directors' report. That would be simple for the companies to do and would provide a ready and easy reckoner, so that the small company could realise just how a company paid its bills. The figure would help meet the needs of small suppliers, by providing additional and easily understandable information on the payment practices of larger companies.
There are a number of advantages to using that measure. As I have shown, it would be easy to calculate. It would be readily understood and interpreted. It would use the amount for trade creditors that appears separately in the annual accounts—except for banks and insurance companies—and require little additional work to identify the purchase amounts to be used in the calculation. The average will be comparable year on year in respect of individual companies and comparable across companies with trading activities of the same style and nature.
The new disclosure requirement is a logical next step to complement the payment policy disclosures that we introduced last year. It is therefore sensible that it should apply to the same companies—public limited companies and their large private subsidiaries. The new requirement will go into the directors' report alongside the policy disclosure. That should help people in smaller supplier companies, who will not have to go through pages of notes to the accounts to search for one figure.
That would also enable users of the information to keep track, in a relatively straightforward way, of how a company's performance measured up to its stated policy year on year. No doubt, it would give directors the opportunity to explain any divergence in the figures at annual general meetings, if the occasion demanded it.
Indeed, most small firms organisations have welcomed the regulations and the added value that they will provide to small businesses that trade with those larger public companies and their private subsidiaries. I echo those thoughts.
As to timing, the new regulations will come into force in relation to the report and accounts for financial years ending after 24 March 1997.
As the Minister who has responsibility for deregulation in my Department, I am aware as anyone, perhaps more than most, of the need to cut red tape wherever possible. However, that does not mean that there should be no regulation. I believe that this modest intervention is

necessary, to help to discourage any large company from succumbing to the temptation to abuse its position. It is clearly a matter of balance.
It is necessary to ensure that the costs to business of the additional administrative burden of monitoring payment performance do not outweigh the prospective benefits of tightening up payment times. It is of no benefit to suppliers if the requirement to collate and publish figures forces large companies to incur significant additional administrative or other compliance costs. The statement, therefore, relies on the public presentation of information that is already collected for the accounts or otherwise readily available. That is why we have opted for the mechanism set out in the regulations. It is a balance between ensuring that valid information is provided and minimising the cost of producing that information.
Tackling late payment is, of course, not just about company reporting. We must see the measures in the context of our wider policies. The House will be aware that I announced in June last year that following a thorough review, the Government would not be legislating for a statutory right to interest. That review was informed by updated submissions from representative bodies that had responded to the public consultation on the matter in 1993; the "Your Business Matters" conferences; and detailed research by the university of Bradford and others.
It was clear from the review that there had been a significant shift in opinion against legislation, particularly by all but one of the small firms representative organisations. Concerns were expressed that legislation would have a negative impact on small businesses; that it would add little to existing rights; and that it might not actually be effective. In fact, it became clear that it was the view of small business that a statutory right to interest would be more likely to harm small businesses than help them.
The evidence from Europe, where most countries have a statutory right to interest, suggests a scant connection between such legislation and evidence of early payment. A statutory right to interest would still involve a small business man or woman appealing to courts, an option that is, in any case, open to them at the moment. It is for such reasons that eight of the nine small firms representative organisations that responded to the consultation rejected the imposition of a statutory right to interest.
Therefore, the view of small business is clear. Steps to eradicate late payment must be taken, but a statutory right to interest is not the solution. Good practice, like most things, begins at home. It is right that the Government should lead by example and ensure that their own house is in order. Departments and agencies are already required to pay their bills within contract terms or 30 days where alternative terms have not been agreed. All Departments have signed up to the Confederation of British Industry's prompt payments code and are required to monitor and publish their actual performance. In addition, the Prime Minister announced in March last year that the Government would publish each year a league table of Departments' payment performance, based on a rigorous system of measurement.
The House will be aware that, on 17 December, my hon. Friend the Economic Secretary to the Treasury published and made available to it the results of that first league table. It is worth noting that the vast majority of


Departments perform well. Those that have underperformed have been left in no doubt about the need to improve. I can assure the House that that is absolutely correct. I have received assurances that those improvements will happen.
Concerns were also expressed at the regional "Your Business Matters" conferences that local authorities were late payers. On 29 November, the Audit Commission published payment performance figures for local authorities, which showed that the average figure for settling invoices on time was 77 per cent. That was based on voluntary returns from 57 per cent. of local authorities. I do not know what hon. Members may think, but I do not believe that either of those figures is satisfactory.
Hon. Members will wish to be aware that the Audit Commission has now announced that it will be issuing a direction to all local authorities requiring payment performance to be a performance indicator for 1997–98. That information will help to inform businesses bidding for local authority contracts just how quickly they will be paid. We can, therefore, see that the regulations build on what the public sector is already doing—providing information to suppliers on when they will be paid.
In the 1994 White Paper on competitiveness, we also announced that we would work with the business community to develop a British Standard for prompt payment. That standard was duly developed by the CBI, to which I wish to pay tribute, with the support of the Department of Trade and Industry. BS7890, "British Standard for Prompt Payment", was launched by myself and the Economic Secretary in September 1996. The standard sets out basic principles of credit management and best practice. It should help to bring about improvements in payment practice and, ultimately, the cash flow of businesses.
We also said that we would look at the court systems as a means of recovering debts. The Lord Chancellor has introduced a number of changes to simplify and streamline court procedures, including raising the small claims limit to £3,000 and making it easier for small businesses to transfer cases to the High Court for enforcement by sheriff's officers.
I have made a personal commitment to take up any case where a small business is facing late payment from a large business. However, the majority of cases that come before me are more likely to involve the provision of poor-quality goods or services rather than late payment. Nevertheless, my open promise stands and any small firm that is not being paid on time by one of the top 100 companies or by any Government Department can approach me.
The Government cannot provide all the answers and there is much that small businesses can do to help themselves. Research by Bradford university has shown that small businesses that invest in front-ended credit management activities have significantly more invoices paid on time and suffer less from bad debts. In the light of that illuminating research, I have asked the chairmen of the business links in England and the equivalent bodies in Scotland, Wales and Northern Ireland to help small businesses to improve their credit management skills. Building on that help, my Department also publishes a free information pack on effective credit management procedures, called "Make the Cash Flow". It is produced in partnership with the Institute of Credit Management and all the main small firms organisations.
The regulations are a substantial step in reinforcing the culture of prompt payment, in addition to measures that the Government have already introduced. They deserve the support of the whole House.

Mrs. Barbara Roche: I welcome this statutory instrument, for which the Labour party has been calling for a number of years. I congratulate the Minister on having finally caught up with us.
The statutory instrument will add to the basket of measures that we plan to introduce and will at least ensure that small firms can find out about the payment practices of the large companies with which they trade. It is four years since Labour first called for the measure and two consultations have been held by Ministers. Given that the first, in 1993, found that 66 per cent. were in favour of acting, can the Minister explain why it has taken him four years to act in this vital area?
It is not too dramatic to say that late payment is the scourge of small firms. It can stop them growing and expanding or—more drastic—it can send basically good businesses to the wall. The Forum of Private Business recently surveyed its members about the issue. I pay tribute to the forum for its sterling work on behalf of its members, in respect of the appalling impact of late payment on small firms. The forum found that one in five of those surveyed had been prevented from growing by late payment. In its response to the Government's response, it explained:
Late payment undermines certainty in commercial transactions, distorting business decisions … Small Businesses … are forced by late payment into increased reliance on loan capital. Given the cost of such funding late payment acts as a direct restraint on growth. This not only has a direct effect on prosperity and tax revenue, but also acts as a significant restraint on employment creation.
The Federation of Small Businesses estimated that, of 40,000 firms that had gone to the wall, 5,000 had done so because of late payment. The problem is not theoretical, but is a live issue that confronts many small businesses up and down the United Kingdom every day. I recently received a letter from a small industrial supplies firm in Glasgow, saying:
We have huge problems and have to struggle day in and day out because of large companies deliberately withholding payments for months at a time. Millions of small firms are in a similar position.
That happens time and again and the bad news is that the problem of late payment in the UK is worsening. The 1996 Grant Thornton European survey found that the average payment period in the UK has increased from 48 days in 1995 to 50 days in 1996.
The Minister referred to the Government's record; let us consider it in a little detail, because it is called into question. I note the Minister's offer; only yesterday, my office had a call from a small, high-tech firm that has among its customers several Government Departments and large businesses. A year ago, after waiting more than two months for a bill of more than £1,000 to be paid by the Treasury, the firm was forced to suspend the service that it was supplying. What a wonderful example our Government set to businesses—they cannot even pay their own bills on time.
It was bad enough for the company to be owed money by the Treasury, but it is also waiting for the Department of Trade and Industry—graced by the Minister—to pay


a bill of several hundred pounds. It has so far waited more than 90 days. No doubt Ministers will say that such instances are anecdotal and do not represent the great efforts that the Government are making.
It is interesting that the Government sometimes blame the very businesses that they are talking about. Only last June, the Minister told The Independent:
Small companies are so delighted about winning an order they forget about getting paid.
More recently, the Minister told The Mail on Sunday that small firms are "unprofessional in credit control". Understandably, Stan Mendham, chief executive of the Forum of Private Business, responded—[Interruption.] The Minister may laugh, but this is what businesses are saying.
Stan Mendham, chief executive of the forum, responded to the Minister by saying:
His facts are fundamentally wrong. I am angry and frustrated at these comments on an issue that causes horrendous problems for businesses.
As the Minister finds the subject so funny, perhaps he will comment on the Government's record in the light of remarks made by the Institute of Directors, which recently said in its "Enterprise" newsletter that it is
well known that the government itself is one of the worst offenders when it comes to late payment.
The fact was resoundingly confirmed in a recent consultation exercise mounted by the IOD on the subject of late payment, with a significant proportion of members telling us that the government routinely pays its bills months late as a matter of course".
What a record for the Minister to have to defend in the House.
I hope that the explanation that the Minister gives later will be better than that of the Economic Secretary, to whom he referred. She explained in a letter to me that her Department had paid one quarter of its bills late because
a member of staff fell ill late in 1994/95 and…the promptness of payment suffered".
She then told the director general of the CBI that that record was
not the crime it had been portrayed".
When I meet representatives of small firms, they are incredulous that the Treasury, which at that time employed more than 1,000 people, had such a terrible record on late payment because one person fell ill. Presumably, when that member of the Treasury staff went off ill, he took the Treasury's cheque book with him. The fact that the Economic Secretary is the Minister in charge of reforming promptness of payment throughout Whitehall and in every Government Department makes the record worse.
Perhaps we can take a look at what the Economic Secretary has achieved. In December, the Government released figures for June to August 1996—they were to show the much-vaunted improvement after the Prime Minister had been embarrassed into telling Departments to pull up their socks, get on with it and see what they could do. Sadly, they were to bring him, and small firms, very little comfort. Nine Government Departments, including the Department of Health, the Department of Transport and the Serious Fraud Office, had a worse

record in that period than in the previous year, 1995–96. The Ministry of Agriculture, Fisheries and Food paid one in five of its bills late.
Even the Deputy Prime Minister, who knows a thing or two about red bills, given his boasts about stringing along his creditors when he was in business, admits that the Government's record is dire. This year's White Paper on competitiveness, referring to the Government's record in that regard, said that there was
a strong perception that
Government Departments
were often amongst the worst perpetrators of late payment.
In March 1996, the Prime Minister said:
I believe we should take steps to generate embarrassment amongst those who wilfully and continually pay late"—
so I hope that from now on the Prime Minister will generate that embarrassment among Government Departments. If the Prime Minister will not do that, the Opposition are determined to do so.
As my right hon. Friend the Leader of the Opposition has said many times, unlike the present Government, the next Labour Government will take tough action on late payment. We want to change the culture that allows large companies and Government Departments to treat small firms as a source of free credit, and we believe that it is necessary to have a basket of measures. [Interruption.] The Minister keeps laughing. I fail to understand what there is to laugh about in this serious subject, which drives many small and medium-sized enterprises to the wall.
Although we applaud the efforts of business organisations, banks and others to improve the credit control procedures of small firms, we do not believe such improvement to be the whole answer. A Labour Government will insist that Government Departments and local authorities pay on time and, after consulting about the best way to do so, we shall introduce a statutory right of interest on the late payment of debt above a given threshold. That would remove the financial advantage that large firms have in paying late. Only the United Kingdom and Ireland do not have a general right to interest embodied in legislation in the event of late payment of commercial debt.
I note what the Minister said when he cavalierly dismissed the arguments for a statutory right to interest. The results of all the surveys that have been conducted on that issue make interesting reading. In a Lloyds bank survey in March 1996, a full 75 per cent. of the businesses that responded welcomed a statutory right to interest. A recent "Business Pages" survey, in 1996, found that 69 per cent. of the businesses that responded supported a statutory right to interest.
Closer to home, a quarter of Conservative Members of Parliament showed support for the Labour party policy of a statutory right to interest by signing an early-day motion. Very many of the Minister's colleagues who are Conservative Members of the European Parliament also support a statutory right to interest, and they signalled that support recently.
What of the statutory instrument before us? We are pleased that, at long last, Ministers have seen the light. The principle behind it is, from one perspective, a freedom of information measure. However, the Minister has not yet answered all the questions surrounding the


new procedure. The Forum of Private Business and the Federation of Small Businesses are worried about how it will be enforced. Perhaps the Minister will comment.
The British Bankers Association has expressed significant anxieties about the formula used. It points out that the calculated period would be extremely distorted as a result of purchases falling unevenly towards the end of the year. A company that bought 100 widgets for 11 months and 200 in the 12th, and paid in 30 days, would be shown as taking 56 days to pay under the proposed method. As the British Bankers Association points out, that is not an uncommon scenario, as most organisations have an increase in purchasing activity towards the end of the financial year, as budget holders seek to spend the moneys allocated to them for that year. Almost more worrying, a company that paid very late throughout the year and then made few or no purchases in the last month would have a squeaky-clean record and appear a very prompt payer.
Will the Minister explain how he will avoid that situation, so that small firms get the most accurate information possible, and why he did not require large firms to state what percentage of their bills are paid within the given payment policy period, as Departments are required to do? That would mean that firms could easily be compared, just as, for example, we can look at the latest Government figures and see that the Department of Trade and Industry has a worse record on paying its bills on time than the Office of the National Lottery. The Minister may want to dwell on that point later. We could also compare the public and private sectors, which might prove to be an illuminating exercise.
When Ministers finally got round to taking up our suggestion that large firms should state their payment practices in their annual reports, the Under-Secretary of State said in a press release that the aim of the statutory instrument was to
give small firms more details of the payment records of the larger companies with whom they may be considering doing business.
Yet even with that new measure, small firms will have to collect all the annual reports of the large companies with which they are considering doing business in order to make meaningful comparisons.
That is why I am pleased to announce that, in government, Labour will encourage small business organisations and others to consider collating that information and publishing it in league tables of prompt payers, so that small firms can decide for themselves which large firms to do business with. I have already spoken to both the Forum of Private Business and the Federation of Small Businesses about that suggestion and they are keen to be involved.
This is yet another example of Labour's determination to tackle the problem and reform Britain's red bill record. I commend our proposal to the House and to the small firms that are following the national debate on this vital issue, which makes so many of their lives a misery. Small and medium-sized businesses are the backbone of our economy and they deserve better support. They will get better support than this failing Government have been able to give them.

Sir John Cope: I welcome this statutory instrument. As my hon. Friend the Minister admitted in his opening speech, it is new regulation on businesses, but

I am encouraged to see that on today's Order Paper we have no fewer than four deregulation orders to decide later under the excellent new procedure of the Deregulation Committee. So that makes four motions to two, if one counts motion 3 on merchant shipping and ro-ro passenger ship survivability. Nevertheless, that sounds to me to be another desirable regulation and I think that four to two is not too bad in the circumstances.
I welcome the statutory instrument because the Small Business Bureau, of which I have the honour to be the deputy chairman, has been pressing for it for a long time. The excellent director of research of that organisation, Mr. Barry Baldwin, has pressed particularly hard in that respect. Under its modern policy of agreeing to everything that anyone else says, the Labour party has also been pressing for such regulations recently, so I am glad that they are welcomed all round.

Mrs. Roche: Does the right hon. Gentleman accept that it has been our policy for about four years and that it is the Government who have just woken up to it?

Sir John Cope: I cannot vouch for the time that the hon. Lady mentions. I have been conscious for only about a year of the Labour party pressing for it, but it may have made the suggestion earlier. However long ago it claims to have made the suggestion, the matter has been on the Small Business Bureau's agenda for a long time. That is where the proposal originated.
This is only one part of the DTI's strategy to combat the late payment of debt, as my hon. Friend the Minister explained in his opening remarks. It is a difficult problem and it will remain a difficult problem.
The hon. Member for Hornsey and Wood Green (Mrs. Roche) quoted the Grant Thornton survey, saying that, between 1995 and 1996, the situation had become slightly worse—the average payment period increasing from 48 days to 50 days. She could have pointed out that, in 1993, it was 52 days, so depending on the period it is also an improvement. I do not think that there is a significant statistical difference in any of those figures.
This method, and the other methods that my hon. Friend the Minister outlined, is a better way to tackle the problem of late debt than the proposal, which has been around for many years, for statutory interest on late payment. I am, of course, well aware that the Forum of Private Business, particularly its very energetic chief executive, Stan Mendham, has campaigned tirelessly about this for many years, since the forum's inception. I have argued with him on many occasions, in various capacities, and I have never been in favour of statutory interest on late payment. The reasons deserve to be set out, as the proposal has been made.
My hon. Friend set out a couple of the reasons. When I was an articled clerk in an accountant's office, it was quite normal in those days—now a long time ago, I am sorry to say—for firms, particularly in some trades, to charge interest on late payment, or, as it was more often expressed, discount for prompt cash payment. That practice has greatly decreased in this country and is now relatively rare, but that is not so, I am told, in Germany, where it is quite common to offer a discount for prompt cash payment. I suspect that it exists informally to a certain extent in large retail stores and so on because of the growth in the use of credit cards, but as a formal mechanism the practice has declined.
The provision already exists in the law of this country to permit an interest charge on late payment, or discount on cash, if the firms concerned in the transaction wish to do it that way. The fact that few companies make use of that provision would seem to show that there is not a great call for it. Ultimately, a business has to calculate how hard to pursue the debt, and whether by pursuing it in one way or another it will be more likely to get the money.
A firm has to determine why the debt is being paid late. If the problem arises because the debtor is short of money, the fact that interest will be payable on the debt is of no help at all. If he cannot pay the capital, he will not be able to pay the interest either. Depending on the level of interest, it could still be cheaper for the debtor to take trade credit rather than a bank overdraft.

Mr. Nigel Evans: Does my right hon. Friend accept that these regulations will assist small to medium-sized enterprises in their knowledge about late payment? However, that is just one of many things to which they will look to assist them, for example, competitive interest rates, low inflation, and the continuation of the deregulation initiative started by the Government. There will, however, be a number of measures that they will be pitted against, such as the introduction of a minimum wage and the imposition of the 48-hour directive, both of which are measures that the Labour party, which pretends to support small to medium-sized enterprises, encourages.

Sir John Cope: That is quite correct. Many small businesses, particularly retail businesses, of which my hon. Friend has a great deal of experience, will not benefit from statutory interest on late payment, because by definition retail cash businesses have no debtors. They take cash over the counter. They are doing their best to manage their cash flow to try to sell the goods that they buy—before they have to pay for them, if possible. That is the ideal in retail business, and very small businesses are often retail businesses. As far as they are concerned, the proposal for statutory interest on debt is not desirable at all. It will harm them.
The other point is that the legislation would need to be incredibly complicated. Just think of the complexities of deciding the first day of the statutory period. In some cases it is easy: it is from the delivery of the goods. But in many cases it is much more complicated. As my hon. Friend the Minister pointed out, when goods are delivered or services given, disputes sometimes arise and people do not wish to pay until that dispute is sorted out—quite rightly.
When one has decided the first day of the statutory period, one then has to decide the length of an appropriate statutory period. For many businesses this differs according to the trade. The habit is different in some trades because the trades themselves differ. In many trades there is a retention. In the building trade, a proportion of the money is not paid until six months—sometimes longer—after the work has been completed, and that is quite normal. What is to happen about that?
Provision would need to be made for all of that in the legislation, which would lead to such legislation being exceptionally complicated.

Sir David Mitchell: Does my right hon. Friend accept that, in terms of late payment, one small business is as guilty as another, and very often small business customers are late in paying, not just large ones? If one were to make early payment a legal requirement, many small businesses would be in severe financial difficulty as a result of having to pay more frequently.
What is to be done with this new information is quite important. I ask my right hon. Friend to consider the situation of the Government as contractors; the Government place an enormous number of contracts, and there are an enormous number of sub-contractors. Will the Government take account of late payment in deciding whether to place contracts? Will that be a requirement? That would be really effective.

Madam Deputy Speaker (Dame Janet Fookes): Order. That is the second rather lengthy intervention that we have had. I caution hon. Members against long interventions, which by their nature should be short. There is no great pressure to speak at the moment as far as I can see.

Sir John Cope: It was, nevertheless, a very good intervention, and well worth while if I may say so.

Madam Deputy Speaker: I judge only the length, not the quality.

Sir John Cope: I agree entirely with that, Madam Deputy Speaker.
I agree with my hon. Friend the Member for North-West Hampshire (Sir D. Mitchell). The point about statutory interest on late debt is that if a business is reluctant to enforce through the courts the collection of the principal sum that it is owed, will it not also be just as reluctant to try to enforce any interest that is payable as well? In difficult cases where a business is having difficulty extracting money, the proposal would be of little value to business.
It is for all those reasons that I think that the approach adopted by my hon. Friend the Minister, in this statutory instrument, and in the other measures that he outlined, is the correct approach to the very serious problem of late debt.

Mr. Nick Harvey: I welcome the proposed regulations. I think that hon. Members on both sides of the House will agree that late payment can have a crippling effect on small and medium-sized enterprises. Although I entirely take the point that some small companies are guilty of late payment, it remains that more often small businesses are the victims of late payment, being dependent on tight budgeting to realise investment projects and to consolidate markets.
To be blunt, late payment provokes simple questions of integrity and business ethics. The withholding of moneys, for whatever reason, should be dealt with firmly and, in my opinion, by legislation. Today's proposals are at least


a step in the right direction. The problem is widespread, as it has become normal practice for many large companies to delay payments. The inclusion of payment practice in the directors' report for each financial year will make employees and shareholders aware of their company's payment practice. If their company follows a specified and approved code of conduct, the public or shareholders may rest assured that it is following good business practice.
The key objective is—and must be—to change the culture of bad business practice, which has legitimised payment as an accounting device in order to create the appearance of healthy balance sheets and to provide short-term finance dishonestly. We welcome proposals to encourage better payment practices and to improve all credit management. However, we believe that the outlined proposals do not go far enough. We can deal fully and effectively with the withholding of moneys only by introducing effective legislation. In the past few years, an alarming number of small businesses across the United Kingdom have failed—more than 20,000 failed in 1996.
Such businesses provide jobs, capital, investment and enterprise, and the economy could not survive without them. Yet a massive number of small businesses are failing or finding themselves stuck in a quagmire of economic difficulty and financial hardship. At a time when more than ever we need strong economic growth, we should take measures to eradicate irresponsible business practices such as late payment of debt. We should create the best circumstances for small businesses to grow and prosper.
Although the new regulations cover stating payment practice, it would not be mandatory for companies to inform their suppliers or creditors of their practice. Directors' reports do not have a particularly wide

circulation, tending to go only to major shareholders. They would rarely be distributed to other suppliers. Therefore, we believe that the answer is to introduce a statutory right to interest. There are difficulties involved with such a move: as the right hon. Member for Northavon (Sir J. Cope) said, legislation would be complicated, and some of the similar regimes abroad are not particularly effective. However, Sweden and Germany offer statutory redress against overdue payments—including interest on late payment of debts—that is among the best offered by our continental partners, and they demonstrate consistently lower average payment periods.
A statutory right to interest would establish an important catalyst for motivating companies to pay on time. Although I accept that the Government genuinely wish to see the business culture improve, we must provide a stick as well as a carrot. Any such legislation would require widespread consultation with small companies and other interested organisations. I recognise that there has been a consultative process, and that some voices have been raised against the statutory right to interest proposal. However, that does not alter the fact that many businesses and their representatives continue to argue strongly for the measure. We must include provisions to ensure that debts are retrieved efficiently and cost-effectively and that creditors' contracts are not adversely affected.
I do not believe that the proposals will sufficiently reduce the burden of late payment of debt on small businesses, but I welcome them as a starting point from which further action can be taken.
Question put and agreed to.
Resolved,
That the draft Companies Act 1985 (Directors' Report) (Statement of Payment Practice) Regulations 1997, which were laid before this House on 27th January, be approved.

House of Commons Disqualification Act 1975

Madam Deputy Speaker (Dame Janet Fookes): I must announce that Madam Speaker has selected amendment (b), standing in the name of the hon. Member for Newham, South (Mr. Spearing).

The Paymaster General (Mr. Michael Bates): I beg to move,
That Schedule 1 to the House of Commons Disqualification Act 1975 be amended as follows:—

PART I OF SCHEDULE 1

Amendment

1. For the entry 'Judge of the Court of Session' there shall be substituted the following entry:—

Judge of the Court of Session, or Temporary Judge appointed under the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990.

PART II OF SCHEDULE 1

Additional entries

2. The following entries shall be inserted at the appropriate places:—


The Antarctic Act Tribunal established under regulations made under the Antarctic Act 1994.
The East of Scotland Water Authority.
The Land Authority for Wales.
The Local Government Staff Commission (England).
The North of Scotland Water Authority.
The Scottish Children's Reporter Administration.
The Scottish Legal Aid Board.
The Scottish Water and Sewerage Customers Council or any committee established by that council under paragraph 10(1) of Schedule 9 to the Local Government etc. (Scotland) Act 1994.
The Training and Employment Agency Advisory Board in Northern Ireland.
The West of Scotland Water Authority.

Entry omitted

3. The following entry shall be omitted:—
The Scottish Development Agency.

PART III OF SCHEDULE 1

Additional entries

4. The following entries shall be inserted at the appropriate places:—


Adjudicator appointed under section 5 of the Criminal Injuries Compensation Act 1995.
Adjudicator for the Inland Revenue, Customs and Excise and the Contributions Agency.
Assessor appointed for the purposes of section 133 of the Criminal Justice Act 1988.
Chairman of an Agricultural Land Tribunal or member of a panel appointed under paragraph 14 or 15 of Schedule 9 to the Agriculture Act 1947.
Chairman or Vice-Chairman of the Arts Council of Northern Ireland.
Chairman, Deputy Chairman or Chief Executive of the Biotechnology and Biological Sciences Research Council.

Chairman or Chief Executive of the Council for the Central Laboratory of the Research Councils.
Chairman, Deputy Chairman or Chief Executive of the Engineering and Physical Sciences Research Council.
Chairman or Vice-Chairman of the English Sports Council.
Chairman or Deputy Chairman of the Financial Reporting Council.
Chairman or any director of the Further Education Development Agency.
Chairman of Investors in People UK.
Chairman, Deputy Chairman or Chief Executive of the Medical Research Council.
Chairman or Director of the National Forest Company.
Chairman of the Northern Ireland Community Relations Council.
Chairman of the Northern Ireland Council for the Curriculum, Examinations and Assessment.
Chairman, Deputy Chairman or Chief Executive of the Particle Physics and Astronomy Research Council.
Chairman of the Rural Development Council for Northern Ireland.
Chairman or any member, not also being an employee, of the State Hospitals Board for Scotland.
Chairman of the United Kingdom Sports Council.
Chairman or Vice-Chairman of the Youth Council for Northern Ireland.
Civil Service Commissioner.
Civil Service Commissioner for Northern Ireland.
Commissioner for Public Appointments.
Commissioner for Public Appointments for Northern Ireland.
Any director of Horticulture Research International in receipt of remuneration.
Director General of Gas for Northern Ireland.
Her Majesty's Chief Inspector of Prisons for Scotland.
Member of the staff of the Forestry Commissioners.
Member of the legal panel of persons available to act as chairmen of Registered Homes Tribunals.
Member of the legal panel of persons available to act as chairmen of Registered Homes Tribunals in Northern Ireland.
Any member of the property commission established by virtue of section 19 of the Local Government etc. (Scotland) Act 1994.
Any member of a residuary body established by virtue of section 18 of the Local Government etc. (Scotland) Act 1994 who is in receipt of remuneration.
Any member of the staff commission established by virtue of section 12 of the Local Government etc. (Scotland) Act 1994.
Northern Ireland Commissioner for Protection Against Unlawful Industrial Action.
Parliamentary Commissioner for Standards.
President of the Industrial Tribunals (England and Wales), President of the Industrial Tribunals (Scotland) or member of a panel of persons appointed to act as chairmen or other members of industrial tribunals.
President of the Special Educational Needs Tribunal, or member of a panel of persons appointed to act as chairmen or other members of that tribunal.

Entries omitted

5. The following entries shall be omitted:—


Chairman, or Director General and Deputy Chairman, of the Agricultural and Food Research Council.
Chairman or member of a panel of deputy-chairmen of an Agricultural Land Tribunal.
Chairman of the Business & Technology Council.
Paid Chairman of the Central Transport Consultative Committee for Great Britain established under section 56 of the Transport Act 1962.
Chairman of the Council for the Accreditation of Teacher Education.
Chairman of the Land Authority for Wales.
Chairman of the Letchworth Garden City Corporation.
Chairman of the Northern Ireland Rural Development Council.
Any Chairman of the Plant Varieties and Seeds Tribunal.
Chairman of the Science and Engineering Research Council.
Chairman of the Scottish Legal Aid Board.
Chairman or Vice-Chairman of the Sports Council.
Chairman of the Training and Employment Agency Advisory Board in Northern Ireland.
Delegate for Her Majesty's Government in the United Kingdom to the Central Rhine Commission.
Director of British Telecommunications p.l.c. nominated or appointed by a Minister of the Crown or government department.
Director of Northern Ireland Airports Limited.
Director of the successor company (within the meaning of the British Steel Act 1988) being a director nominated or appointed by a Minister of the Crown or by a person acting on behalf of the Crown.
Director of the successor company (within the meaning of the British Technology Group Act 1991) being a director nominated or appointed by a Minister of the Crown or by a person acting on behalf of the Crown.
Director of a successor company (within the meaning of Part II of the Electricity Act 1989), being a director nominated or appointed by a Minister of the Crown or by a person acting on behalf of the Crown.
Any member of the Insolvency Practitioners Tribunal in receipt of remuneration.
Member of a Wages Council appointed under paragraph 1(b) of Schedule 2 to the Wages (Northern Ireland) Order 1988.
President, or member of a panel of chairmen, of industrial tribunals established under section 12 of the Industrial Training Act 1964.
Secretary of the Medical Research Council.

Other amendments

6.—(1) In the entry 'Chairman or Vice-Chairman of the Advisory Committee on Distinction Awards', for `Vice-Chairman' there shall be substituted 'Medical Director'.

(2) In the entry 'Chairman of the Economic and Social Research Council', after 'Chairman' there shall be inserted 'Deputy Chairman or Chief Executive'.

(3) In the entry 'Chairman or Deputy Chairman of the General Consumer Council for Northern Ireland', the words 'or Deputy Chairman' shall be omitted.

(4) In the entry 'Chairman of the Livestock Marketing Commission for Northern Ireland', for 'Marketing' there shall be substituted 'and Meat'.

(5) In the entry 'Chairman of any of the National Boards for Nursing, Midwifery and Health Visiting constituted under section 5 of the Nurses, Midwives and Health Visitors Act 1979', there shall be inserted at the end 'or any member of any of those Boards appointed at a salary'.

(6) In the entry 'Chairman or non-executive member of a National Health Service trust established under the National Health Service and Community Care Act 1990 or the National Health Service (Scotland) Act 1978', for 'non-executive member' there shall be substituted 'non-executive director'.

(7) In the entry 'Chairman of the Natural Environment Research Council', after 'Chairman' there shall be inserted 'Deputy Chairman or Chief Executive'.

(8) For the entry 'Member of a panel of chairmen of industrial tribunals established under Article 30 of the Industrial Training (Northern Ireland) Order 1984' there shall be substituted the following entry:—

Member of a panel of persons appointed to act as chairmen or other members of industrial tribunals in Northern Ireland.

(9) In the entry 'Rent officer or deputy rent officer appointed in pursuance of a scheme under section 63 of the Rent Act 1977', the words 'or deputy rent officer' shall be omitted.

PART IV OF SCHEDULE 1

Entry omitted

7. The entry relating to Her Majesty's Lord-Lieutenant or Lieutenant for an islands area in Scotland shall be omitted.

Other amendments

8.—(1) In the entry relating to Her Majesty's Lord-Lieutenant or Lieutenant for a region in Scotland—

(a) for 'a region' there shall be substituted 'an area'; and
(b) for the words from 'such part' to 'Majesty' there shall be substituted 'the area'.

(2) In the entry relating to Her Majesty's Lord Lieutenant or Lieutenant for the district of the city of Aberdeen, Dundee, Edinburgh or Glasgow—

(a) the words 'the district of' shall be omitted; and
(b) for 'the district in' there shall be substituted 'the city in'.

The motion seeks the approval of the House to an amendment by Order in Council of schedule 1 to the House of Commons Disqualification Act 1975. As hon. Members are aware, the Act is concerned with the maintenance of the independence of the House and the safeguarding of hon. Members from undue influence by the Executive through the exercise of patronage. Schedule 1 to the Act lists those offices whose holders are thereby disqualified from membership of the House.

It has been usual practice for any legislation that establishes new offices or winds up existing ones to amend schedule 1 accordingly. The 1975 Act is therefore reprinted from time to time in accordance with the provisions of the Act to incorporate such amendments. The last reprint was made on 6 January 1994. A further reprint will be ordered after the new order has been made. In addition, from time to time, it is necessary to use the procedure outlined in section 5(1) of the Act in order to bring schedule 1 up to date by Order in Council.

This section provides for the schedule to be amended following an affirmative resolution of the House by adding offices that have been created by administrative action, by amending or correcting existing entries and by deleting offices that no longer exist or where statutory disqualification is no longer appropriate. This procedure has been followed on 10 previous occasions, the first in


1961 and the last in June 1993. Copies of the explanatory note describing the amendments in detail have been made available in the Vote Office since 6 February.

Ministers have been individually responsible for the details of the additional entries and deletions that cover the offices within their areas of responsibility. They have based their judgments on the same general principles and criteria that have been followed in the past and are covered by the explanatory note. Of the 85 amendments covered, 48 are new entries, 25 are deletions and 12 are amendments to existing entries. Approximately 3,400 office holders will be brought within the scope of schedule 1, and up to 240 others will no longer be disqualified. That includes offices that have been abolished. There is, therefore, a net increase of 3,160 disqualified office holders. Of the 3,400 added to the schedule, up to 2,700 are lay members of industrial tribunals in Great Britain and Northern Ireland, the vast majority of whom are already precluded from sitting as Members of Parliament by the terms governing their appointment.

We propose that the de minimis level—the level below which paid officers in the gift of the Crown or Ministers do not normally attract disqualification—should remain at £8,000, as agreed in 1993. Of course, the de minimis level has no effect on the level of remuneration received by office holders. Its purpose is merely to prevent trivial disqualification. As we are following a well-established procedure, I commend the motion to the House.

Mr. Jeff Rooker: I apologise to you, Madam Deputy Speaker, and to the Minister for not being present for the beginning of the debate.

Mr. Peter Ainsworth: Disgraceful.

Mr. Rooker: I agree with the hon. Gentleman. I am reminded of the debates that I read while preparing my speech. When a similar motion was moved in 1985, my colleague with the relevant responsibility was not present. As I had spoken on the previous legislation, I became the first speaker for the Opposition; so I have had my comeuppance.
It is interesting to note that we are not dealing with a statutory instrument or with delegated legislation, but are being asked to amend a schedule to an Act of Parliament on the say-so of a motion on the Order Paper. That might have some advantages, in that the motion is clearly amendable. However, it means that the normal scrutiny procedures of the House will not apply: we will not be able to examine the proposals, take evidence and ask questions. I shall return to that issue later.
I welcome the explanatory notes on the motion—although I think that they should have been available earlier. They were not available last Thursday when I left the building, so the Vote Office posted them to me on Friday and I read them during the weekend. In previous years, the notes were available from the Vote Office up to three or four weeks before debate in the House. The notes comprise an excellent, up-to-date list of the quangos established by the Government—many salaries run to six

figures—so it is a useful addition to our weaponry. The notes are not available for general sale: there is no price or reference number on the document. In a way, it is the main meat of the motion.
Other than the holders of office set out in section 1 of the main Act, such as civil servants, the police, the armed forces and members of foreign legislatures, those who are disqualified from membership of the House—the number runs to well over 1 million people—are not covered by statutory criteria. There are ambiguities, and there is a good deal of ministerial discretion as to who is and is not disqualified. We are now adding another 3,400 of our fellow citizens to the list of those disqualified from membership of the House of Commons. It is clear that membership of the House should be as open and as accessible to as many citizens as possible, and that disqualifications must be clear, unambiguous and reasonable.
Although it is called the House of Commons Disqualification Act, it does not cover all the people who are disqualified from membership of the House. Bits and pieces of a tabloid newspaper are being put through our doors by a fictional political party, which exists only in the bank balances of its leader. A member of a foreign legislature is not able to be a Member of the House. We can have dual membership of this House and the European Parliament. That usually means a seat in the United Kingdom Parliament and a seat in the European Parliament, but I am not sure about the arrangements. How does the Act apply to a person who sits in the European Parliament for a constituency in France and seeks membership of the United Kingdom Parliament? Perhaps the Minister could take advice on whether it is lawful for the leader of the Referendum party to seek membership of the House while being a Member of the European Parliament for a foreign nation.
The Act is comprehensive. I want to draw some of the paradoxes to the House's attention by way of illustration—I would obviously be out of order, Madam Deputy Speaker, if I went into substantial detail. Our fellow citizens are not treated equally: some are disqualified from being Members of the House under schedule 1, and some are disqualified under other Acts of Parliament.
The legislation that applies to ordained ministers of religion goes back to the House of Commons (Clergy Disqualification) Act 1801. When preparing for this debate, I was struck by the recent publication by Robert Blackburn, reader in public law at King's college, called "Electoral System in Britain". He delves into the history of certain aspects of the process, including parliamentary candidates. He gave examples that occurred in Oxfordshire. A candidate at the last general election in Oxford, West and Abingdon is disqualified for life from membership of the House because he used to be an ordained priest of the Roman Catholic Church, even though he has now resigned the priesthood. If he had won the seat, the House might have addressed the issue. Bruce Kent did not win, but even if he changes his faith or declares no faith, the fact that he was once an ordained priest of the Roman Catholic Church means that he is disbarred for life from membership of the House.
That does not apply to someone who is disbarred because he is a civil servant. The right hon. Member for Witney (Mr. Hurd) was a distinguished former Home Secretary and Foreign Secretary, and had previously been a civil servant.


One day, he was a civil servant and disqualified from membership of the House; the next day, he resigned and was able to be a candidate and serve as a Member of the House. The same applies to a minister of the Church of England, who is disqualified but can also resign and then be a candidate. Priests of the Catholic Church are disqualified for life, whether or not they remain in their faith. That is one of the inconsistencies and anomalies.
The Minister is now adding 3,400 persons to the list of those banned from membership of the House. He referred in his short introduction to the largest group: the 2,700 of our fellow citizens who serve on industrial tribunals. They are unpaid lay people who do a valuable job for society. They are required to be politically impartial in the execution of their judicial function: that is part of the operation of a tribunal. Why have they not been added to schedule 1 before? Industrial tribunals have existed for the best part of 30 years. Has consultation taken place? It is part of their terms and conditions that they cannot be Members of the European Parliament or Members of the House. Why change now?
The schedule was updated in 1993, 1985 and 1987: every three or four years, although not necessarily tying in with general elections; sometimes it has been twice in a Parliament. At no time have the general lay members of industrial tribunals been added to the list of those disqualified from serving in the House.
Some hon. Members may be justices of the peace, who are not technically banned from serving in the House. Members are advised not to sit as JPs, but if they can manage the requirement of 26 sessions a year, not in their own constituency and not as a paid stipendiary magistrate, technically nothing prevents them from being elected as a Member of the House. There is therefore a paradox if the requirement is for political neutrality or impartiality in a judicial function.
There is also a contradiction in respect of local government councillors who serve as magistrates, even in the locality of their council. Why are they allowed to continue to undertake a function for which they have to be judicially impartial while not being disqualified from membership of the House, whereas we disqualify the lay members of industrial tribunals? That does not make sense. It is not equal and fair treatment for people carrying out the same sort of quasi-judicial function. It is unfair that one group of 2,700 people—it includes members of industrial tribunals in Northern Ireland—is disqualified.
The schedule has been added to and has grown like Topsy at ministerial whim, without proper scrutiny by the House, because of the manner in which it is done—by resolution and not by statutory instrument. It gets worse. When I read previous debates, I was reminded of what happened in 1985, when I had to make a brief contribution. Full-time members of the judiciary are rightly disqualified from being Members of the House, but part-time members of the judiciary are not disqualified, as we shall hear from my hon. Friend the Member for Newham, South (Mr. Spearing). Why should a part-time paid judge, who acts as a recorder, be able to sit in Parliament, and a part-time unpaid member of an industrial tribunal be disqualified? It is not fair, does not make sense, and is wholly inconsistent and illogical.
I invite anyone who thinks that I am nit-picking to look at the first amendment to schedule 1. The Secretary of State for Scotland is disqualifying temporary judges from membership of the House.

Mr. Nigel Spearing: Quite right too.

Mr. Rooker: Absolutely, quite right.
To disqualify temporary judges in Scotland and lay members of industrial tribunals yet allow part-time judges in England to sit in the House is inconsistent and unfair. I raised this point in the debate on 22 July 1985 at column 801. I asked about recorders and was fobbed off by the then Minister. He referred us to an earlier debate on 12 April 1983. I have taken the precaution of reading that debate again. Why part-time judges under the guise of recorders can sit in the House was not satisfactorily explained. We were given the historical reasons for the acceptability of that, but I did not find them satisfactory then, and I do not think that they are satisfactory now—especially in view of the fact that we are ruling out changes in regard to lay, unpaid members of industrial tribunals.
In our debate on 22 July 1985, when we discussed schedule 1, my speech was followed by one from a Conservative Back Bencher who challenged the whole idea that Ministers could add to the list of people disqualified from membership of the House as we are doing today. He made what I considered a powerful case for the criteria to be made clearer and more precise: it can be found in columns 802 and 803 of the Official Report. He described the current practice as "highly undesirable".
There are four criteria, and I ask the Minister to confirm that they are not statutory. The first criterion refers to
offices of profit in the gift of the Crown or Ministers",
which includes salaried, pensionable and certain fee-paid posts. There is a de minimis of £8,000. People whose remuneration is below that level can, however, be excluded at the Minister's discretion.
Also excluded are
certain positions of control in companies in receipt of Government grants and funds, to which Ministers usually, though not necessarily, make nominations".
I shall return to that in a moment.
The third criterion refers to
offices imposing duties which, with regard to time and place, would prevent their holders from fulfilling Parliamentary duties satisfactorily"—
which means that they would take up too much time, or otherwise prevent a Member from attending Parliament.

Mr. Andrew Mackinlay: I had to re-read that.

Mr. Rooker: So did I—as, indeed, I have in the past.
As I have said before, I think that it would be difficult to legislate for a full-time House, but these are non-statutory criteria operating against some of our fellow citizens.
The fourth category is
offices whose holders are required to be, or to be seen to be, politically impartial.
That covers many of the examples that we are discussing today.
As I have said, in 1985 a Conservative Back Bencher described the process as highly undesirable. He questioned the payment levels involved in disqualification, and claimed—I believe there were some grounds for his claim—that people were disqualified when it was not possible to test whether they should be, because of the lack of scrutiny. He called for a Select Committee to look at the draft resolution each time, and report to the House before it came to us for approval. If it were a statutory instrument, that would be possible: the Select Committee on Statutory Instruments could examine it, and take advice and evidence.
I agreed with that Member of Parliament then, and I agree with him now. So why do we have amendments Nos. 16 and 38? The amendments are not numbered on the Order Paper—for our inconvenience—but they are numbered 16 and 38 in the set of notes with which we have been provided. They are listed at lines 42 and 43 on page 1898 of the Order Paper, and at lines 72 and 73 on page 1899, and both are promoted by the Minister of Agriculture, Fisheries and Food. It so happens that the Minister—the right hon. and learned Member for Grantham (Mr. Hogg)—is the Member who spoke from the Back Benches in 1985, and said that this was a wholly undesirable process. The House is almost empty and there is plenty of time, but I am not hunting for the right hon. and learned Gentleman. I prepared my speech three days ago, well before I knew about next week's censure motion.
Amendment No.16 covers the
Chairman of an Agricultural Land Tribunal or a member of a panel appointed under paragraph 14 or 15 of Schedule 9 to the Agriculture Act 1947.
The new entry will bring up to 306 office holders into the schedule—306 more citizens who cannot become Members of Parliament. We are given the same old argument that such people must be politically impartial in the execution of their judicial functions.
The new entry in amendment No. 38 is
Any director of Horticulture Research International in receipt of remuneration.
That, too, is promoted by the Minister of Agriculture.
I have a question, the answer to which I have not been able to discover fully, even from our experts in the Library. Horticulture Research International was set up on 1 April 1990, in response to the recommendations of a Government study. Why were the 10 paid directors who have been added to schedule 1 today not included in 1993, when the schedule was last updated? What has happened since that has caused them to be on this list, although they were not on the earlier list? It is possible that, although the organisation was set up in 1990, no one was paid until after 1993; that is what I have not been able to establish by looking at the annual reports in the Library.

Mr. Peter Bottomley: It may be worth emphasising, for the benefit of those who read the report of the debate, that it is possible to give up such a position before taking a seat in the House.

Mr. Rooker: Earlier—the hon. Gentleman probably was not in the Chamber yet—I drew attention to one of the paradoxes that are involved in the legislation. Most of those who are barred from membership—more than 1 million

people—can become eligible for parliamentary seats by giving up their posts, but that does not apply to someone who has been an ordained priest in the Catholic Church. That cannot be wiped out: those people are banned for life, whatever happens in the future.
There is a procedure—although I do not know the details—in respect of, I believe, the armed forces and the police. I understand that a little sub-committee at the Home Office, comprising six former Members of Parliament and a couple of other people, adjudicates on whether people can give up certain positions in order to stand for Parliament. Its purpose is to ensure that frivolous people are not trying to get out of the armed forces, as probably the most famous example did many years ago—but I shall not go down that byway. The hon. Member for Eltham (Mr. Bottomley) is right: people can give up their posts voluntarily.
What worries me most are the inconsistencies and apparent unfairness. I have mentioned people who serve on industrial tribunals, part-time judges and local councillors who serve on the bench. The criteria and rules applying to those people are not the same, and there seems to be no good reason for that.

Mr. Mackinlay: I agree with everything that my hon. Friend has said, but let me ask a rhetorical question: would not members of industrial tribunals face a real dilemma if they intended to stand for Parliament in a few weeks' time? They would have to resign before the election, because they cannot resign after they have been elected. That strikes me as demonstrably unfair. Having resigned from the tribunal, an unsuccessful candidate for election would have to be beholden to the Secretary of State for Education and Employment: it would be for the Secretary of State to reinstate that person.

Mr. Rooker: It is some five years since I signed the nomination papers to be a parliamentary candidate, but I have a feeling that a candidate has to sign a statement that he is not excluded by the terms of the House of Commons Disqualification Act. Being on the list means that a person cannot be a legal candidate, which is why I question how Bruce Kent could possibly have been a legal candidate in the last election. Clearly, under the 1801 Act, he could not have taken his seat in the House if he had been successful.
The House is so slothful in bringing its procedures up to date that we would be forced to face the issue only if someone succeeded in an election in those circumstances. As my hon. Friend the Member for Newham, South will confirm, however, shortly after the election of a Member of Parliament we had to pass a retrospective motion enabling him to remain a Member, all because he had given a few hours' paid service as a medical adviser to a medical tribunal. I think that it was the late Lord Winstanley—I hope I am not doing him a disservice; I believe that he is now deceased—who served as a Liberal Member of Parliament, representing, I think, Colne Valley.
The House could rectify the position if something like that happened, but there would be one hell of a row, particularly as we have not set up proper procedures to ensure that there is fairness, openness and logicality in the way in which we disqualify more than 1 million people from being Members of the House.

Mr. Mackinlay: Was it not absurd that, in 1979, Dame Sheila Roberts was elected to the European Parliament in


the Conservative cause, was a successful candidate for London South West and then found that she was disqualified? In what was a technical anomaly, there was no such mechanism for her position to be rectified, as in the case of Dr. Michael Winstanley, the former Member for Cheadle and then for Colne Valley. There had to be a by-election, at enormous public cost, which Dame Sheila again subsequently won—with a diminished majority, but she won. It was an absurd circus for that Conservative Member of the European Parliament to be elected, to be disqualified and then to have to stand again, all because there had not been true and reasonable understanding of the ground rules and no mechanism was in place to remedy what was demonstrably an error.

Mr. Rooker: It all comes down to the fact that there is not really a consolidated list and a formal structure whereby that list can be scrutinised and we have all the people who are disqualified from membership of the House. We are dealing here, it is true, with the schedule to the main Act, but the Act, as I have said more than once, is not the only Act that disqualifies people from membership of the House. In an open, accessible and pluralistic Parliament, there should be good grounds, as we approach the 21st century, to review wholesale disqualification, some of the rules of which, as I say, go back to the early part of the 19th century. Such a review is long overdue.
Having considered this in some detail in recent times, having considered the matter in a different capacity and having discussed it with one or two of my colleagues, it is something that a new Government would consider. That may be done by a Select Committee, by someone who is independent or by the Nolan committee.
This has grown like Topsy. It is shot full with anomalies, inconsistencies, unfairnesses and illogicalities. It is right that there has to be some sort of disqualification procedure; it is clearly necessary for the natural categories of disqualification: the police, the civil service and armed forces. However, matters have got out of hand when the list can be added to by ministerial discretion, where there are no clear criteria. What is more, the House has failed to set up a proper scrutiny procedure so that we can go through these things in detail, instead of having to deal with them in just an hour and a half this evening.

Mr. Peter Bottomley: I acknowledge that I was not here at the beginning of the debate, but I did hear the relevant points that were made by the hon. Member for Birmingham, Perry Barr (Mr. Rooker). I say to my hon. Friend the Minister that the anomalous position involving people who have been ordained in the Roman Catholic Church needs to be sorted out. Roman Catholics are discriminated against in a number of ways. For instance, Roman Catholic bishops cannot pick the title of their diocese, but that is slightly away from this debate. The anomalous position of two people, one of whom has been ordained as a Roman Catholic priest and one of whom has been ordained as an Anglican priest, should be on all fours. I hope that my hon. Friend the Minister will ask someone to find a way in which the House can consider dealing with that anomaly. It is not the most important issue, but it is one of fairness.
There is an alternative way in which to deal with some of the positions in part III of schedule 1. Given that most of the people involved are appointed by Ministers, there

is no reason why Ministers should not say that they will disappoint anyone who is successful in an election. That would solve some of the problems of people who would want to continue with their ordinary lives, if they are unsuccessful candidates. It can be done in a simple way. Where the appointment cannot be taken away, it may be possible to say that people will not be able to sit. There may be other administrative ways in which to deal with that.
Outside the Chamber, I was reminded by the hon. Member for Newham, South (Mr. Spearing) that I had some form, if I may put it that way, over noticing that some of our colleagues have sat as temporary judges and assistant temporary judges—let us say as recorders. I cannot remember precisely what I might have said; I suspect that the hon. Gentleman will comment on that. If there are examples of people perhaps feeling that in some way they have not received justice because someone who has some prominence beneath his wig has sat either as a justice of the peace or as a judge, they should certainly be able to object in advance.
Whether people should be prohibited from sitting as judges or as recorders is not something on which I have strong views today, but I do believe that the answer to most of the questions put by the hon. Member for Perry Barr, the Opposition spokesman, is that it is not the highest priority in Government Departments to consider whether new or adapted jobs should join the list. It is one of those things where there is an occasional trawl. People cough up possible positions that might be held to be suitable for disqualification. At the margin, there will always be difficulties.
I am not sure that it is right to accept necessarily the criticism that doing it by amendment makes it less easy for the House to consider the matter than doing it by secondary legislation. By secondary legislation we do not have the opportunity of tabling amendments. At least with this procedure, we do.
It is not the most important issue because the House would, I suspect, overturn nearly all disqualifications, were that to be tested. The right hon. Member for Chesterfield (Mr. Benn) repeatedly stood for the House of Commons, although he was disqualified under previous rules because he had inherited a place in the House of Lords. The House did then make changes to allow people not to take up peerages or to drop hereditary peerages.
I say in passing that some of the positions in part III would not disqualify a Member of the House of Lords from sitting there. I think that I am right in saying that a Member of the House of Lords can be chairman of a research council. The Earl of Selborne served in a distinguished way on the Agriculture Research Council. I do not argue for consistency. The position of holding an office of profit under the Crown is worth protecting. I do not make any adverse comment about prohibiting some people in the more senior ranks of the civil service from being actively involved in national politics, but I do not think that we want to screw things down so far that those who want to take part in local politics should be discouraged from doing so, if it is compatible with their role.
In general we get these things about right, but if we ever get to the stage where we are wanton or careless in the people we do not allow to stand for Parliament, we should be careful. It is far better to disqualify people after


election, if necessary, than to stop them standing. We want to allow the widest range of people to stand, even though a fair number of them can be reasonably sure that they will not be elected in any particular election.

Mr. Nigel Spearing: I beg to move amendment (b), in paragraph 1, after "following entry" insert—

'Additional Entry

1A. The following entry shall be inserted at the appropriate place:—

Recorder and Assistant Recorder".'.
I must join the hon. Member for Eltham (Mr. Bottomley) in referring to previous debates. He did indeed speak on 12 April 1983, and he used these words:
As we are close to a general election, it is not for me to spell out exactly which part of the Government's policy I thoroughly support and which part I support, especially as the debate is to end at half past 11."—[Official Report, 12 April 1983; Vol. 40, c. 771.]
Therefore, he did participate in that debate, when I moved virtually the same amendment as I have moved tonight.
I should also inform the House, to make this a comprehensive survey perhaps, as of now, that the other part of the hon. Gentleman's contribution related to what appeared to be an anomaly to some of us at that time: the appointment of a Member of the House, the former right hon. Robert Mellish, who had been the Opposition Chief Whip—he is now a noble Lord in another place. He was the deputy chairman of the London Docklands development corporation, which was a salaried office, but one for which he chose, understandably, not to receive remuneration.
There was an anomaly of an office of profit under the Crown, which I would have thought, in normal terms, that would have been. Some people—I should add that the then Robert Mellish's constituency was included in that region—naturally felt that he might have gained advantage as a Member by being vice-chairman and, at the same time, that he gained advantage as vice-chairman by being a Member, particularly as a Secretary of State of another party was involved. I make that point only because the anomaly has, happily, disappeared—although happily Lord Mellish has not.
I congratulate my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) on his interesting opening speech. We obviously do not disagree on these matters along party lines. There is a case for a Act to consolidate the historic prohibitions and remove the anomalies. It would not matter if that caused repetition, because the later Act would displace the former.
There are two separate issues before us. One is the prohibition on certain citizens standing as candidates—which is perhaps overdone, as the hon. Member for Eltham suggested—and sitting as Members. Some people should not be candidates—judges of the High Court, for example—but many more should be allowed to stand on the assumption that they would resign their office if they won. They could sign a document to that effect.
The other issue, which affects fewer people, is the prohibition on sitting Members being appointed to offices of profit. If sitting Members are allowed to act as

recorders, as they are in England, they have an advantage. They are not allowed to act in a judicial capacity in Scotland and that is the anomaly. My hon. Friend the Member for Thurrock (Mr. Mackinlay) pointed out that there are requirements for political impartiality for members of the judiciary. If a Member is appointed to sit as a recorder or an assistant recorder, he will be politically partial unless he sits as an independent, which is unusual. That situation is constitutionally dubious, as I shall mention later, and should be tidied up.
I understand the objection that my hon. Friend the Member for Perry Barr made about the procedure today. On the other hand, it has some advantages. We are not restricted to only an hour and a half's debate, as would be the case with a statutory instrument.

Mr. Rooker: We have only an hour and a half today.

Mr. Spearing: In that case, I must watch the length of my speech. The matter is being addressed by a motion of the House and we have been able to table amendments—an opportunity that I have taken.
We need better documentation. I am grateful for the explanatory note, but a White Paper with a House of Commons number would have been better. We do not know who published the explanatory note, because it does not say, and it is not signed by a Minister, or even on his behalf by a civil servant.
On 12 April 1983, no fewer than 15 Members were recorders or assistant recorders. Now there are only three, and I have informed the right hon. and hon. Members concerned of my amendment. I believe that their character, their knowledge of the House and their knowledge of the law make them capable of playing a different role when they put on a wig, even if they occupy a senior position in a political party or appear on television programmes on important civic matters. You, Madam Deputy Speaker, with your colleagues in the Chair, are an excellent example of the ability of right hon. and hon. Members to switch into different roles.
However, that ability is not immediately apparent to those who send us here. They find it difficult to accept the idea that someone can one day sit, fully bewigged and in a judicial capacity, alongside full-time judges—who stand apart from the rest of us in many ways, and properly so—and the next day be here dealing with the political hurly-burly. It is a constitutional anomaly. We are always told by constitutionalists that the judiciary, the legislature and the Executive each have their own functions. The Executive is created and destroyed by the legislature, and is accountable to it. The judiciary and the legislature are properly separated. Of course, there has to be a join somewhere, and in England and Wales it comes in the persons of the Attorney-General, the Lord Chancellor and the Solicitor-General. In Scotland, of course, the Law Officer of the Crown who fulfils the duties of the Solicitor-General is not a Member of Parliament. That underlines the point that my hon. Friend the Member for Perry Barr made earlier about better practice in Scotland, which may be something to do with its Presbyterian heritage. Nobody could deny that the anomaly exists.
In the debate in 1983, Mark Carlisle—then the right hon. Member for Runcorn, now Lord Carlisle of Bucklow—made a distinguished speech, but the only argument that he advanced in favour of the status quo was


that it was important to maintain a link between those who make the law, especially on police and criminal matters, and those who dispense it in a judicial capacity. Others have argued that it is important for those with judicial experience to bring their knowledge of the realities of the law to the House, but that does not mean that anyone has to fulfil both roles simultaneously. Hon. Members meet people from chambers of commerce, industrialists, transport workers and borough councillors, who tell us of the impact of our work on them and what they require from the legislature. The special pleading for those who act as recorders is not so strong, therefore, as it sounds on first hearing. There are many opportunities for people acquainted with judicial matters to bring their experience to bear here and in another place.
So the argument in favour of that arrangement is for the future. This is more of a discussion than a definitive occasion. Even if by chance the idea were accepted tonight, I would not suggest that the three or four right hon. and hon. Members concerned should summarily be dismissed from those offices of profit. The matter is more for the future than for an immediate decision today.
However, as my hon. Friend the Member for Perry Barr said, the further we go, the more necessary it is for anomalies to be cleared up and the documentation improved. Above all, hon. Members and those who pay attention to us should be assured that we not only exercise democracy but are seen to do so. So long as there is the anomaly of hon. Members with paid judicial functions elsewhere, that will not be so.
Perhaps the Government will give me an assurance in response to my final question. Some years ago, the anomaly was so great that a Member was appointed recorder of a town in the area that he represented. Such a thing would not be tolerated today, but it happened then. I understand that the office is no longer a local government function, as it was historically, but became an office of profit under the Crown in the 1970s.
I hope that the Minister will assure us that if further appointments are made before any change in the law, despite the fact that arrangements are now made on an area basis, people will not be able to sit anywhere near the area that they represent, or an area with which they have close connections of any sort. Conflict of interests would thereby be avoided.
That hope and that suggestion fall somewhat short of my amendment. I moved the amendment, but I do not wish to press it heavily, other than for the purposes of discussion. I hope that the Minister will respond as constructively and thoughtfully as my hon. Friend the Member for Perry Barr did in his interesting speech.

Mr. Andrew Mackinlay: It seems to me that whether the measure should be implemented by order is not the most important issue. The most important issue is whether the ideas in the motion have been properly canvassed. I listened carefully to my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker), and it was clear that he had not had the opportunity to understand the full extent of the proposed amendments. If he has not had that opportunity, and other hon. Members have not been given reasonable time, the people most affected have certainly not been given notice.
I am thinking primarily of the people who diligently serve, basically as volunteers, on industrial tribunals. I shall talk about them later. It seems mean-spirited, if

not rather sloppy of the Minister not to allow an adequate consultation period before bringing the matter before the House. He can screw up his face as much as he likes, but he has not done that, and he is a sloppy Minister. That fact needs to be put on the record. [Interruption.] I shall come to the hon. and learned Member for Harborough (Mr. Gautier) in a moment. If my adrenaline really starts to flow, when I start asking questions about people having other jobs besides being Members of Parliament—

Madam Deputy Speaker: Order. I caution the hon. Gentleman against straying out of order by going far beyond what is before us tonight.

Mr. Mackinlay: Indeed, I am very mindful of that warning, as always, Madam Deputy Speaker.
Once I realised that the subject would be debated today, I obtained the so-called explanatory note, but it is not very good. It consists of a list rather than an explanation. Consequently I tabled some parliamentary questions as soon as I could. I have just slipped out of the Chamber to see if any answers have arrived, but none has.
That is why I ask the Minister whether, if with the leave of the House he replies to the debate, he will explain the alterations affecting the position of lieutenants and lord-lieutenants of the islands in Scotland. Perhaps the changes are a consequence of local government reorganisation.
If the Minister had not been so dilatory and sloppy he could have included that in his explanatory note, or at least ensured that I received a reply before we embarked on the debate. If he were at school he would be given only four out of 10, at the most, for his stewardship of what should be a relatively easy matter to bring before the House.
I asked the Minister for an explanation because I wondered whether the Conservatives had selected a candidate who is a lord-lieutenant for an islands area. Perhaps that is why they had to make the exclusion. I do not know, but I am a pretty suspicious fellow when I think of some of the perverse offices whose holders are allowed to be Members of the House, compared with some of the offices that prevent their holders from becoming Members. Perhaps there was a political intention behind the change. No doubt we shall hear from the Minister soon.

Mr. Rooker: I do not want to spoil a good speech, but, as I understand it, the alteration simply takes account of the fact that the word "region" is being changed to the word "area". So far as I know, it is a consequential change in the drafting.

Mr. Mackinlay: I am grateful to my hon. Friend, but he has to be patient for only a few more weeks. He will soon be the Minister. I am criticising the existing Minister for not having regard to what I think is my entitlement as an hon. Member—a full and adequate explanation in the documentation. When that does not exist, and I table a question, surely courtesy dictates that the Minister should have ensured that I had a reply before we embarked on the discussion.
I know that things will be better in about six weeks' time, because my hon. Friend will be the Minister handling the matter. His undertaking to try to secure


parliamentary time for a root-and-branch review of the legislation is welcome. I look forward to that. Perhaps, contrary to his better judgment, my hon. Friend may even allow me to serve on the Committee on the Bill.

Madam Deputy Speaker: Order. The hon. Gentleman must deal with what is happening now.

Mr. Mackinlay: Reference has been made to hon. Members who serve on industrial tribunals. The change is being brought before the House a few weeks before a general election, and it is reasonable to suspect that, at a time when they were not disbarred, some people serving on industrial tribunals will have been selected by political parties as their candidates.
From this afternoon those people will be disbarred. One assumes that that information will filter down to them through the political parties, and they will have a choice of either surrendering their prospective candidacy or resigning from the industrial tribunal before nomination day.
As I said in my intervention, that is tremendously unfair. Unless the present Minister can give an undertaking today, it is unlikely that, having resigned from the tribunals, people who fail to be elected shall then be reinstated almost automatically, on a fresh application.

Mr. Peter Bottomley: It may be helpful to recall that in 1984–85, for reasons that I shall not go into, a number of people resigned from industrial tribunals. As the assistant Minister at the Department of Employment, I managed not to accept their resignations, and later most of those resignations were withdrawn. I do not suggest that we should do anything underhand, but if the proposal before the House causes a problem, the Minister may want to consult and find out whether what happened then establishes a precedent. If so, members of industrial tribunals who stand for election can openly say that they have submitted their resignations, but if they are not elected the resignations will not be accepted, and will in effect be dropped.

Mr. Mackinlay: That is a good idea. It demonstrates the fact that if there had been consultation, such ideas could have been bounced off the Minister informally. He might then have decided not to include members of industrial tribunals on the list in the first place—partly because it was a perverse daft idea anyway. We have heard no persuasive explanation for their inclusion. That was demonstrated by my hon. Friend the Member for Perry Barr, and there is no logical reason for it.

Mr. Bottomley: An alternative would be for my hon. Friend to indicate whether a manuscript amendment could be submitted which would leave the members of industrial tribunals in the position after the passing of the legislation that they were in before—that is to say, they are not included. Were the Chair willing to accept such a late manuscript amendment to that effect, there would be no change from the present position. This might be

important, because clearly members of industrial tribunals make up the majority of those who might be affected and they may not know that they will be affected.

Mr. Mackinlay: I wait with bated breath to hear the reason why they have been included on the list, and we will see why later on.

Mr. Spearing: This procedure illustrates that Parliament—in what is almost a Committee-style debate—can not only find problems but, as the hon. Member for Eltham (Mr. Bottomley) has just done, provide answers. It has just occurred to me that if there is to be a great exit from the Tory Benches, or a risk that some Tory Members may be looking for these jobs, those who are not on the Government Front Bench might be advantaged by the anomaly that I pointed out.

Mr. Mackinlay: I am grateful to my hon. Friend, and I now wish to refer to the amendment. As a matter of principle, serving members of the judiciary should not be Members of this House, as there is a conflict. That is not to say that hon. Members who hold those offices are anything other than diligent Members and skilled practitioners of law. That is not at issue. But it is a matter of constitutional propriety. It is wrong for people who are law makers in their judicial capacity—their judgments can become precedents and the law of the land—also to be Members of Parliament. To have that dual role is unhealthy in a democracy.
My second point on that is that we are talking about a paid office of profit. I am of the view that hon. Members should not have substantial paid outside employment but, alas, that matter is not at issue this afternoon. It is wrong that the state should pay people for substantial outside employment while they are also Members of this House, and the office of recorder is one such post. That is simply wrong. It is a matter of debate whether or not people should have outside interests, and they can defend their position. But the Crown should not be encouraging that in a modern democracy, as most hon. Members find that serving this House is a major preoccupation, seven days a week throughout the year. I hope that when my hon. Friend the Member for Perry Barr is the Minister he will bring forward legislation to deal with that.
My hon. Friend the Member for Perry Barr said that there are problems in legislating for Members of this House to be full time. In many modern Parliaments—including one with which I am particularly familiar, Poland—Members can have outside interests as academics, lawyers or architects, but they do not take a full salary. The system is transparent, and people understand it. Many constituents are not aware that hon. Members are serving as recorders or have other outside interests. We will return to this debate after the election.
My hon. Friend the Member for Perry Barr mentioned the question of Roman Catholic priests. I go along with him that there is an anomaly, but it seems to me that the anomaly is that priests of the Roman Catholic Church and the Church of England cannot be elected to this House.

Mr. Rooker: No.

Mr. Mackinlay: My hon. Friend answers from a sedentary position, but in my view there is no logical


reason why serving Anglican ministers or Roman Catholic priests—although their Churches might not approve—cannot be candidates or serve in this House. They should be entitled to stand, although whether it is prudent for them to do so or is acceptable to their Church is a matter for them and their Church authorities. But there should be a presumption in a democracy that people can stand for the legislature, or there must be extraordinarily good reasons to exclude them.
I accept what my hon. Friend the Member for Perry Barr said. It would have been ridiculous that had Bruce Kent been elected, he would have been prevented from serving as an hon. Member. There was no way in which he could have shed the fact that he had been ordained as a Roman Catholic priest. He would have been in a similar position to that of my right hon. Friend the Member for Chesterfield (Mr. Benn) before the passing of the Peerage Act 1963, in that there was no way in which he could get rid of his disqualification.
I agree with my hon. Friend the Member for Perry Barr that this is a ridiculous situation, but surely the answer is that priests—whether they are members of the Church of England or the Roman Catholic Church—should not be prevented from serving in the House. Episcopalian ministers from Scotland and Wales can be elected, and we know that ministers from other religions serve in this House. I hope that that will be looked at in the not too distant future.
I failed to persuade the Chair about the merits of my amendment, and I will not trespass into its provisions. But it puts down a benchmark for the next Labour Government, who must look at whether or not people can serve in this House and have substantial paid outside employment. I think that that is wrong in a modern democracy, and countries such as the United States have strict rules and limitations about outside employment from which we should borrow. We must make membership of this House more modern, and we should not disqualify very good servants who serve, for instance, on industrial tribunals.

Mr. Bates: With the leave of the House, I shall respond to the speeches that have been made, which—by and large—were of a quality that will help the debate. When we looked at the Act and the amendments to it, we were aware that this was an on-going process. This is not a complete document by any means, and we are not seeking this evening to achieve perfect legislation.
The Act that we are amending now was passed in 1975 by a Government of a different colour. It is not perfect in every form, but the general principles are that we should try to maintain high standards and, wherever possible, avoid apparent conflicts of interest. In the time available to me, I shall try to respond to some of the serious points that have been made.

Mr. Peter Bottomley: The House will be grateful for the attitude that my hon. Friend has shown at the beginning of his reply. In terms of the major parties—

Conservative, Labour and Liberal Democrat—how many adopted prospective candidates are members of industrial tribunals?

Mr. Bates: I am afraid that I do not know the answer to that. It is difficult to quantify, and only when the general election is called will the true nature of the answer be seen.
An important element of this is that the addition of the tribunals' lay members does not mean a change in policy. In 1975, the members of the employment appeal tribunal were disqualified. On taking up their posts, lay members of the tribunal signed an instrument of appointment which set out that they were prepared to resign their membership on adoption as prospective parliamentary candidates. That position is clear. Far from a conspiracy theory about trying to block certain people from entering the House, we were making a genuine effort to try to clear up a matter that could have been misinterpreted. Some may have thought that only the full-time personnel on the employment appeal tribunal would be disqualified, whereas it applied to all members. They should know that, because it was on the instrument of appointment that they signed.
My hon. Friend the Member for Eltham (Mr. Bottomley) made a sensible point when he talked about a similar case that had arisen when he was in office. We are talking about guidelines and, should it transpire after a general election that a candidate was elected who was disqualified under the Act, I am sure that the House would look carefully and sympathetically at the case.

Mr. Bottomley: Is my hon. Friend saying that if I was appointed as a member of an employment appeal tribunal, I would sign a document to the effect that if I was adopted as a prospective parliamentary candidate I would stand down from the EAT, or that those who are appointed to industrial tribunals make that commitment? Would there be a significant harmful effect if the manuscript amendment to leave out lines 90 to 93 and lines 168 to 169 were accepted, so that we do not make the proposed change in this trawl but can come back to it on another occasion?

Mr. Bates: I am talking about industrial tribunals as well as the employment tribunal; I should have made that clearer. On the generous offer of a manuscript amendment, the matter can be reviewed. It has been reviewed 10 times already; indeed, it is under permanent review. The last review was in 1993, and there is no reason why the point could not be considered again if it was deemed to be worth while. We drew on representations, many of which were made during the debate in 1993.

Mr. Spearing: I understand the Minister's reluctance to accept even the suggestion of a manuscript amendment at this hour, but does he agree that another suggestion that might be taken up by readers of this debate is that, if a resignation was tendered, those who had to accept it and


confirm the receipt of it might delay that acceptance or reply until after a certain date? That would at least get rid of the anomaly for the three months coming up.

Madam Deputy Speaker: Order. Before the Minister continues, let me make it crystal clear that it rests with me whether a manuscript amendment is accepted. None will be accepted.

Mr. Bates: Thank you, Madam Deputy Speaker. That stops that line of inquiry in its tracks.

Mr. Spearing: No, it is irrelevant to my point.

Mr. Bates: I listened to the hon. Gentleman and I shall certainly reflect on what he said.
I apologise to the hon. Member for Birmingham, Perry Barr (Mr. Rooker) for the fact that the rather lengthy list was put late into the Vote Office, if it was the case that in previous years the Opposition had longer to study it. We put it there a week ago, but we shall try in future to allow more time for hon. Members to consider our proposed additions. When the amendments that the Government have proposed are made, a reprint will be issued of the 1975 Act shortly afterwards, including a full list of all the positions at issue.
The hon. Member for Perry Barr made some passionate remarks relating to the clergy which were strongly endorsed by my hon. Friend the Member for Eltham. It is important to recognise that a member of the clergy in the Church of England can resign his position by means of the Clerical Disabilities Act 1870 and take his seat in the House. There is no similar Act for Roman Catholic priests. Perhaps there should be: that must be considered on another occasion.
I want to take up the interesting point about the leader of the Referendum party and his position should he seek election to the House. The Council Act of 20 September 1976 establishes the rules for direct elections to the European Parliament, so changes to that Act are outside the scope of the motion. The rules do not debar members of national legislatures from membership of the European Parliament.
The hon. Member for Thurrock (Mr. Mackinlay) made some interesting comments, some of which I do not agree with. He has a habit of looking for the conspiracy in everything: if the answers to questions are late, it must mean that the Government have something to hide, rather than a little bit of slowness in the courier service—which is in fact the only reason.
As the hon. Member for Perry Barr said, this is a deregulatory measure. Where the Act refers to areas, rather than island areas and regions, those are different entries. We have sought to combine them, and that is the reason for the changes.
The hon. Member for Thurrock made some disparaging remarks about my office, which I am sure that, on reflection, he will want to withdraw.

Mr. Mackinlay: Will the Minister give way?

Mr. Bates: Let me just finish what I am saying, because I have some better remarks to come. The hon.

Gentleman made some disparaging remarks, and should he be thinking about intervening, I should mention that I have to hand the Register of Members' Interests, open at his entry.

Mr. Mackinlay: I am grateful to the Minister for giving way. My disparaging remarks related to him, not to his office. The point is that the "explanatory note" contained no explanations, and there had clearly been no consultation. That is why I say that the Minister's stewardship was not right. I do not see a conspiracy, but I believe that there should be proper transparency in the House. As happens so often, measures are being bounced through.

Mr. Bates: Well, seven days is a long bounce, as they say, just as a week is a long time in politics.
An important point was raised about recorders. It has long been recognised that the full-time judiciary must be disbarred from membership of the legislature, and part I of schedule 1 achieves that. It has also been long recognised that it is not only compatible with being a Member of Parliament to practise a profession, but can be a positive advantage, both to the individual Member and to the House as a whole. Several hon. Members are lay justices, and I am not aware of anyone raising any objection to that.
The position of recorders is somewhat different, in that they are paid for each sitting day; it would be a poor judicial system that did not pay them for the valuable work that they do, which is, after all, a public service. Often those people are in chambers and could therefore be earning substantially more than they are given for their daily sitting as a recorder.
Of course, those recorders do not sit within the boundaries of their constituency. My hon. and learned Friend the Member for Burton (Sir I. Lawrence) represents a seat in Leicestershire.

Mr. Edward Garnier: Staffordshire.

Mr. Bates: He represents a seat in Staffordshire, but sits as a recorder in London. I understand that three Members are serving recorders. Their practical knowledge of the administration of justice has brought valuable experience to the House. Members who are recorders or assistant recorders do not, by custom, sit as recorders in their constituencies. Supporters of the amendment have not succeeded in persuading me that that long-established custom should be changed. I therefore advise my right hon. and hon. Friends to vote against the amendment. I commend the motion to the House.

Mr. Peter Bottomley: By leave of the House, I should like to speak again.

Madam Deputy Speaker: The hon. Gentleman cannot speak again.

Mr. Bottomley: On a point of order, Madam Deputy Speaker. We have a difficulty over the industrial tribunal change. My hon. Friend the Minister confirmed in winding up that we are bringing something into statute which was not there before and argued that the House should accept that. He kindly acknowledged in his


winding-up speech, made by leave of the House, that neither he nor other hon. Members know how many people are affected. There is a significant point of order in that the House should not wantonly, recklessly or lightly disqualify from standing people who have been in all honour democratically selected by their parties. May I repeat my request to speak, by leave of the House, in response to the Minister? If I could, it would be useful to people who may be affected by what the House decides in the next 15 minutes.

Madam Deputy Speaker: That is not a point of order. I cannot adjudicate on such matters. It is my strict understanding that it is not possible to speak twice to the same Question except in very limited circumstances. I do not think that that applies to ordinary Back Benchers.

Mr. Spearing: On a point of order, Madam Deputy Speaker. The House is obliged to the hon. Member for Eltham (Mr. Bottomley). He has spotlighted something that did not occur to us in the debate. We do not know how many people might be disbarred in the next few weeks by our decision tonight on candidatures for office. Would it be in order for the Minister not to move the motion, or for it to be negatived? When the Government find out whether anyone will be affected—and the effects could be serious—they could bring back the substantive motion, which could go through the House quickly, perhaps even on the nod. It is, of course, a matter for the Minister to decide whether he should pursue that course of action. If he does not pursue it, and there is difficulty, it may be said that it could have been avoided if he had listened to the debate and to the hon. Member for Eltham.

Madam Deputy Speaker: It is not for the Chair to second-guess a Minister on whether he wishes to withdraw a motion. That must be a matter for him. Normally, if one does not like something, one votes against it.

Mr. Bottomley: On a point of order, Madam Deputy Speaker. I would be most grateful if you could guide me to the reference in "Erskine May" that distinguishes between Back Benchers and Front Benchers speaking by leave of the House. This is my only chance to respond to the Minister's remarks about the debate. For me to block the motion because I was unable to make some concluding remarks would be a rather heavy weapon to use, but, as you said, that is an option open to hon. Members.
The sense of the debate was that the Government should get their change to the law. However, we now know not only that it is possible that people have stood for selection, and perhaps been chosen, but that it is conceivable that they might have put themselves or their parties to inescapable expenses, not knowing that the House would make a retrospective change. The easiest way forward might be if I were to conclude my point of order, listen to your ruling and ask whether by leave of the House, I might make some concluding remarks that could tidy the issue up to the satisfaction of the House. If any hon. Member said no, I would not pursue it. If I could speak, it may help those outside the House who want to join us after the general election.

Madam Deputy Speaker: The general rule is that a Member may not speak twice to the same Question. There

is a different arrangement in respect of the right of reply of Members who have moved substantive motions. I am satisfied that I am right in not allowing the hon. Gentleman to make a further contribution. He has made his various points.

Mr. Bottomley: Further to that point of order, Madam Deputy Speaker. I asked whether there was a reference in "Erskine May" to Back Benchers not being able to ask the leave of the House to speak again.

Madam Deputy Speaker: I have already said what I believe the position to be. I am sure that "Erskine May" references can be found, but I cannot produce them now. I am satisfied that I was correct on my last point.

Mr. Spearing: On a point of order, Madam Deputy Speaker. Would it be in order for the Minister, if he so wishes, to take my suggestion before you put the Question on my amendment?

Madam Deputy Speaker: I am sorry, but I did quite not catch that.

Mr. Spearing: Would it be in order for the Minister to pursue my suggestion, which I hope was constructive, to avoid any problems with candidates in the next three weeks, before you put the Question on the amendment, which I believe is the next formal Question to be put by the Chair? So far, the Minister has shown no sign of so doing, but I hope that he would use it as an insurance policy so that the House will not be blamed for any consequences. We do not know the facts.

Madam Deputy Speaker: I cannot rule from the Chair on what a Minister wishes to do. No doubt he will make his decision plain and the hon. Gentleman will be able to decide his course of action.

Mr. Rooker: On a point of order, Madam Deputy Speaker. Can you confirm that you understood that the Minister said that the resolution formalises the status quo? Perhaps the Minister could confirm that passing this measure does not change anything. However, for the better information of those who may be affected in the next couple of weeks, perhaps all 2,700 of them could have the issue drawn to their attention as a matter of urgency so that they would know exactly where they stand.

Madam Deputy Speaker: That is not a point of order.

Mr. Bates: On a point of order, Madam Deputy Speaker. This bout of points of order may be due to the fact that we have not made absolutely clear the position on people who may seek election to the House. With your permission, I hope to make it clear. Their instruments of appointment to their present positions would require them to resign forthwith on becoming prospective parliamentary candidates. I hope that that is clear for the record.

Mr. Bottomley: On a point of order, Madam Deputy Speaker. The House has not been told when that was brought in. I was not aware of it when I used to make appointments

Mr. Rooker: indicated dissent.

Mr. Bottomley: If, as a Minister, I was not aware of it, I am not sure that all those who were appointed were


aware of it. The situation is unsatisfactory. I support the suggestion that if people put in prospective letters of resignation, Departments should not be too speedy in acting on them.

Madam Deputy Speaker: Order. The hon. Member knows that that is not a point of order and we cannot pursue it further.
Has the Minister concluded his remarks?

Mr. Bates: Yes, Madam Deputy Speaker.
Amendment negatived.
Main Question put and agreed to.
Resolved,
That Schedule 1 to the House of Commons Disqualification Act 1975 be amended as follows:—

PART I OF SCHEDULE 1

Amendment

1. For the entry 'Judge of the Court of Session' there shall be substituted the following entry:—

Judge of the Court of Session, or Temporary Judge appointed under the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990.

PART II OF SCHEDULE 1

Additional entries

2. The following entries shall be inserted at the appropriate places:—

The Antarctic Act Tribunal established under regulations made under the Antarctic Act 1994.
The East of Scotland Water Authority.
The Land Authority for Wales.
The Local Government Staff Commission (England).
The North of Scotland Water Authority.
The Scottish Children's Reporter Administration.
The Scottish Legal Aid Board.
The Scottish Water and Sewerage Customers Council or any committee established by that council under paragraph 10(1) of Schedule 9 to the Local Government etc. (Scotland) Act 1994.
The Training and Employment Agency Advisory Board in Northern Ireland.
The West of Scotland Water Authority.

Entry omitted

3. The following entry shall be omitted:—

The Scottish Development Agency.

PART III OF SCHEDULE 1

Additional entries

4. The following entries shall be inserted at the appropriate places:—


Adjudicator appointed under section 5 of the Criminal Injuries Compensation Act 1995.
Adjudicator for the Inland Revenue, Customs and Excise and the Contributions Agency.
Assessor appointed for the purposes of section 133 of the Criminal Justice Act 1988.

Chairman of an Agricultural Land Tribunal or member of a panel appointed under paragraph 14 or 15 of Schedule 9 to the Agriculture Act 1947.
Chairman or Vice-Chairman of the Arts Council of Northern Ireland.
Chairman. Deputy Chairman or Chief Executive of the Biotechnology and Biological Sciences Research Council.
Chairman or Chief Executive of the Council for the Central Laboratory of the Research Councils.
Chairman, Deputy Chairman or Chief Executive of the Engineering and Physical Sciences Research Council.
Chairman or Vice-Chairman of the English Sports Council.
Chairman or Deputy Chairman of the Financial Reporting Council.
Chairman or any director of the Further Education Development Agency.
Chairman of Investors in People UK.
Chairman, Deputy Chairman or Chief Executive of the Medical Research Council.
Chairman or Director of the National Forest Company.
Chairman of the Northern Ireland Community Relations Council.
Chairman of the Northern Ireland Council for the Curriculum, Examinations and Assessment.
Chairman, Deputy Chairman or Chief Executive of the Particle Physics and Astronomy Research Council.
Chairman of the Rural Development Council for Northern Ireland.
Chairman or any member, not also being an employee, of the State Hospitals Board for Scotland.
Chairman of the United Kingdom Sports Council.
Chairman or Vice-Chairman of the Youth Council for Northern Ireland.
Civil Service Commissioner.
Civil Service Commissioner for Northern Ireland.
Commissioner for Public Appointments.
Commissioner for Public Appointments for Northern Ireland.
Any director of Horticulture Research International in receipt of remuneration.
Director General of Gas for Northern Ireland.
Her Majesty's Chief Inspector of Prisons for Scotland.
Member of the staff of the Forestry Commissioners.
Member of the legal panel of persons available to act as chairmen of Registered Homes Tribunals.
Member of the legal panel of persons available to act as chairmen of Registered Homes Tribunals in Northern Ireland.
Any member of the property commission established by virtue of section 19 of the Local Government etc. (Scotland) Act 1994.
Any member of a residuary body established by virtue of section 18 of the Local Government etc. (Scotland) Act 1994 who is in receipt of remuneration.
Any member of the staff commission established by virtue of section 12 of the Local Government etc. (Scotland) Act 1994.
Northern Ireland Commissioner for Protection Against Unlawful Industrial Action.
Parliamentary Commissioner for Standards.
President of the Industrial Tribunals (England and Wales), President of the Industrial Tribunals (Scotland) or member of a panel of persons appointed to act as chairmen or other members of industrial tribunals.




President of the Special Educational Needs Tribunal, or member of a panel of persons appointed to act as chairmen or other members of that tribunal.

Entries omitted

5. The following entries shall be omitted:—

Chairman, or Director General and Deputy Chairman, of the Agricultural and Food Research Council.
Chairman or member of a panel of deputy-chairmen of an Agricultural Land Tribunal.
Chairman of the Business & Technology Council.
Paid Chairman of the Central Transport Consultative Committee for Great Britain established under section 56 of the Transport Act 1962.
Chairman of the Council for the Accreditation of Teacher Education.
Chairman of the Land Authority for Wales.
Chairman of the Letchworth Garden City Corporation.
Chairman of the Northern Ireland Rural Development Council.
Any Chairman of the Plant Varieties and Seeds Tribunal.
Chairman of the Science and Engineering Research Council.
Chairman of the Scottish Legal Aid Board.
Chairman or Vice-Chairman of the Sports Council.
Chairman of the Training and Employment Agency Advisory Board in Northern Ireland.
Delegate for Her Majesty's Government in the United Kingdom to the Central Rhine Commission.
Director of British Telecommunications p.l.c. nominated or appointed by a Minister of the Crown or government department.
Director of Northern Ireland Airports Limited.
Director of the successor company (within the meaning of the British Steel Act 1988) being a director nominated or appointed by a Minister of the Crown or by a person acting on behalf of the Crown.
Director of the successor company (within the meaning of the British Technology Group Act 1991) being a director nominated or appointed by a Minister of the Crown or by a person acting on behalf of the Crown.
Director of a successor company (within the meaning of Part II of the Electricity Act 1989), being a director nominated or appointed by a Minister of the Crown or by a person acting on behalf of the Crown.
Any member of the Insolvency Practitioners Tribunal in receipt of remuneration.
Member of a Wages Council appointed under paragraph 1(b) of Schedule 2 to the Wages (Northern Ireland) Order 1988.
President, or member of a panel of chairmen, of industrial tribunals established under section 12 of the Industrial Training Act 1964.
Secretary of the Medical Research Council.

Other amendments

6.—(1) In the entry 'Chairman or Vice-Chairman of the Advisory Committee on Distinction Awards', for Nice-Chairman' there shall be substituted 'Medical Director'.

(2) In the entry 'Chairman of the Economic and Social Research Council', after 'Chairman' there shall be inserted 'Deputy Chairman or Chief Executive'.
(3) In the entry 'Chairman or Deputy Chairman of the General Consumer Council for Northern Ireland', the words 'or Deputy Chairman' shall be omitted.
(4) In the entry 'Chairman of the Livestock Marketing Commission for Northern Ireland', for 'Marketing' there shall be substituted 'and Meat'.
(5) In the entry 'Chairman of any of the National Boards for Nursing, Midwifery and Health Visiting constituted under section 5 of the Nurses, Midwives and Health Visitors Act 1979', there shall be inserted at the end 'or any member of any of those Boards appointed at a salary'.
(6) In the entry 'Chairman or non-executive member of a National Health Service trust established under the National Health Service and Community Care Act 1990 or the National Health Service (Scotland) Act 1978', for 'non-executive member' there shall be substituted 'non-executive director'.
(7) In the entry 'Chairman of the Natural Environment Research Council', after 'Chairman' there shall be inserted 'Deputy Chairman or Chief Executive'.
(8) For the entry 'Member of a panel of chairmen of industrial tribunals established under Article 30 of the Industrial Training (Northern Ireland) Order 1984' there shall be substituted the following entry:—

Member of a panel of persons appointed to act as chairmen or other members of industrial tribunals in Northern Ireland.
(9) In the entry 'Rent officer or deputy rent officer appointed in pursuance of a scheme under section 63 of the Rent Act 1977', the words 'or deputy rent officer' shall be omitted.

PART IV OF SCHEDULE 1

Entry omitted

7. The entry relating to Her Majesty's Lord-Lieutenant or Lieutenant for an islands area in Scotland shall be omitted.

Other amendments

8.—(1) In the entry relating to Her Majesty's Lord-Lieutenant or Lieutenant for a region in Scotland—

(a) for 'a region' there shall he substituted 'an area'; and
(b) for the words from 'such part' to 'Majesty' there shall be substituted 'the area'.

(2) In the entry relating to Her Majesty's Lord Lieutenant or Lieutenant for the district of the city of Aberdeen, Dundee, Edinburgh or Glasgowߞ

(a) the words 'the district of shall be omitted; and
(b) for 'the district in' there shall be substituted 'the city in'.

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 101(6) (Standing Committees on Delegated Legislation),

MERCHANT SHIPPING

That the draft Merchant Shipping (Ro-Ro Passenger Ship Survivability) Regulations 1997, which were laid before this House on 23rd January, be approved.—[Mr. McLoughlin.]
Question agreed to.

DEREGULATION

Madam Deputy Speaker (Dame Janet Fookes): With permission, I shall put together motions 4 to 7.
Motion made, and Question put forthwith, pursuant to Standing Order No. 14A(1) (Consideration of draft deregulation orders),
That the draft Deregulation (Employment in Bars) Order 1997, which was laid before this House on 16th December, be approved.
That the draft Deregulation (Casinos) Order 1997, which was laid before this House on 20th January, be approved.
That the draft Deregulation (Validity of Civil Preliminaries to Marriage) Order 1997, which was laid before this House on 20th January, be approved.
That the draft Deregulation (Gaming on Sunday in Scotland) Order 1997, which was laid before this House on 20th January, be approved.—[Mr. McLoughlin.]
Question agreed to.

Welwyn Hatfield Council (Slough Estates)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. McLoughlin.]

Mr. David Evans: Thank you, Madam Deputy Speaker, for allowing me to bring this issue to the Floor of the House. It is crucial to the financial well-being of all my constituents. To paint the picture, I should like to start with Labour-controlled Welwyn Hatfield council's agreement with two property companies—Slough Estates and the Carroll group. In the late 1980s, putting it simply, Slough Estates was to build a shopping centre in Welwyn Garden City, without any restriction on the type of shops, but was nervous, to say the least, that its investment would be undermined if the Park Plaza scheme, hereafter referred to as The Galleria, did not have a strict tenants mix agreement as to the type of shops.
The council agreed to Slough's request, so the company proceeded to develop the site, and an impressive shopping complex it is, too. The Carroll group pressed for the relaxation of the tenants mix agreement. In an aide-memoire prepared for the Labour council working party, Martin Hayes, the then chief finance officer, said:
In view of the very recent approval to the Howard centre and the sensitivity that those developers have always shown to the Park Plaza scheme, the decision to relax the tenants mix agreement in the way suggested cannot be minuted at this stage. Nevertheless, such a decision would have to be acted on behind the scenes.
So there we have it. I repeat what Mr. Hayes said:
In view of the very recent approval to the Howard centre and the sensitivity that those developers have always shown to the Park Plaza scheme, the decision to relax the tenants mix agreement in the way suggested cannot be minuted at this stage. Nevertheless, such a decision would have to be acted on behind the scenes.
The A1(M) working party, which has a Labour majority and includes six Labour members, accepted that decision and the full council endorsed it, although not all councillors were informed of the policy change. In the recent ruling against the council following the change in 1987, the judge said:
Thereafter, after 1987 there was a policy of lies.
So there we have it again. If I may, I shall repeat what the judge said:
Thereafter, after 1987 there was a policy of lies.
The leader of the council was Stan Atkinson, a Labour councillor. The deputy leader at that time was Councillor Ray Little, who stood in 1992 as my Labour opponent at the general election and subsequently became leader of the council. Councillor Chris Gillen was chairman of the 1987 A1(M) working party. The judge said:
They acted as a nucleus who steered the rest.
They are, to their eternal shame, still councillors and have not done what any honourable person should do in these circumstances—resign.
If that was not bad enough, more scandal was to follow. The new Labour leader of the council in 1996, Mr. Ray Little, was offered, three days before going to court, an out-of-court settlement of £16 million by Slough Estates. Without any consultation with the council officers or Labour colleagues, Mr. Little refused on behalf of all the


people of Welwyn Hatfield. He should be locked up and the keys thrown away. He single-handedly robbed the people of Welwyn Hatfield—my constituents—of £32 million. What is more, he could not care less.
Can my hon. Friend the Minister please say whether any application was made to the Department of the Environment for permission to use the council's capital receipts to settle the Slough Estates debt when the offer was made and we had the chance to settle the case for just £16 million, before it went to court? If so, was permission refused by the Government?
As a result of that Stalinist slap in the face, Slough Estates took the Labour council to court and won a judgment of £48 million, which has now increased to £53 million with the addition of costs and interest accruing. I repeat the figures in case the House did not hear me. The £48 million has now increased to £53 million. The Labour council decided to appeal, but then withdrew the appeal on legal advice. It is now trying to find the money to pay the debt.
This fiasco should make people think about the consequences of voting Labour, not only in Welwyn Hatfield but across the nation. Where Labour is in control, we have financial incompetence, lies and bankruptcy.
How can we settle this appalling state of affairs? If we wait for my Labour opponent in the forthcoming general election to speak on the subject, we shall wait for ever. Her silence has been deafening, but then she lives in Cambridge. The people of Welwyn Hatfield tell me that she is not interested, because it is not her problem, but for people who live in the constituency, it certainly is.
I want my hon. Friend the Minister to watch my lips. Is he looking? However this debt is to be paid, which it will have to be, David Evans will not allow it to be paid by a surcharge on every household in Welwyn Hatfield, with a council tax bill of at least £1,500. I will say it again, just to make sure that my hon. Friend has heard me. However this debt is to be paid, which it will have to be, David Evans will not allow it to be paid by the people of Welwyn Hatfield through a surcharge on every household, with a council tax bill of at least £1,500.
After the payment of £10 million from reserves, the amount owing is now about £43 million. That is increasing by a staggering £7,000 a day in bank interest. The council has £15 million on deposit from council house sales, which is earning interest at about £900,000 per year. It would like to pay that amount to Slough Estates, thereby reducing the debt to £28 million, with the balance to be paid with the receipts from large-scale transfer of housing stock. I have supported that approach fiercely in the past.
As my hon. Friend the Minister knows, I have been in constant contact in person, by telephone and by letter with my right hon. Friend the Secretary of State. However, I am well aware that there are one or two stumbling blocks that might be difficult to surmount in order to bring the current difficulties of Welwyn Hatfield to a quick conclusion. I emphasise that those stumbling blocks have been created not by the Government, but by the attitude of the Labour-controlled Welwyn Hatfield council.
The first problem seems to me to be how the council would make up the loss of £900,000 interest accruing on £15 million on deposit, which goes directly into income available for expenditure by the council. One presumes that the shortfall would be added to the council tax bills. If that is the Labour council's intention, I say no way.
Does my hon. Friend the Minister believe that the council, having reduced the debt to £28 million, has the incentive to embark seriously on the transfer of housing stock when, over many years, it has dragged its feet on embracing Government policy? That policy would allow my constituents to buy their own homes or agree to have them run by a housing association, which has the interests of tenants at heart.
Even as recently as last month, the Labour group leader said on the front page of Welwyn Hatfield Times that she believed that Labour councillors would refuse to sanction the transfer of housing stock to meet the judgment against the council in the Slough Estates fraud.
In the past couple of weeks, however, the council seems to have had a change of heart. I wonder why. Unfortunately for my constituents, not least those living in council-owned property, the damage has been done by Labour councillors and their cohorts on the council. Their statement in the local newspaper has sent a disgraceful message to tenants, who, as we all know, have their own vote to decide whether a housing association should take over their properties. Labour councillors have effectively said, "Don't vote for the transfer of your home to housing associations." We all know, however, that if they did that under that Labour-controlled council, they certainly would not be any worse off than they are now.
Perhaps the Minister would like to take this opportunity to tell my constituents about the virtues of transferring housing stock to a housing association and the benefits that tenants would enjoy. In my opinion, with its message to tenants, the Labour council is once again trying to obstruct Government policy that would help the people of Welwyn Hatfield and improve the quality of life for tenants, but as we all know, that council says one thing and does another.
Perhaps the Minister can also confirm that whatever is the outstanding debt, 100 per cent. of receipts from the transfer of housing stock to housing associations will be available for use to pay off the debt and not just 25 per cent., according to the current rules.
I expect the Government to tell us tonight what the next step is. The people of Welwyn Hatfield deserve our support. They have been let down by the Labour councillors whom they elected in good faith, year in and year out, over the past 20 years. They are fortunate that we have a Conservative Government to try to protect them—a Government who have also ensured that their council tax is capped. They have a Conservative Member of Parliament who champions their cause without fear or favour.
Finally, may I say that this Member will not allow the Government, civil servants, councillors or officers simply to wash their hands of this nightmare in the hope that it will go away? It must be resolved in the best interests of my constituents, and those who are responsible for the lies, fraud and deceit must be brought to book. They must be made responsible for the debt and they must be disqualified from ever standing as councillors again. In that way, those incompetent, inadequate financial pygmies will never ever be allowed to rob the people of Welwyn Hatfield again.

The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford): It is always a pleasure to listen to my hon. Friend the Member for


Welwyn Hatfield (Mr. Evans). I can advise him that there is no need to watch his lips—we can hear him quite emphatically and clearly.
My hon. Friend repeated the key points of an unpleasant story, the facts of which are well known, and so they should be. It is a private and local grief, and a tragedy for the local people—the tenants and the residents who will have to pay if the council has its way—whom my hon. Friend has championed.
We know that it is a difficult situation. The story is well known and has been clearly related by my hon. Friend. In essence, in 1987, the council took certain planning decisions relating to a retail development in its local authority area. Slough Estates plc, the owners of the Howard centre, a nearby shopping development, considered that it had not been treated fairly and challenged the council's decisions.
Recently—for the benefit of my hon. Friend. I should like to repeat that it was very recently—we heard that, last year, the council was offered an out-of-court settlement of £16 million. We were not aware of that at the time. No application for assistance in regard to the offer was received by my Department, so no decision could be made on a request that was not asked.
The case went to court. Slough Estates successfully sued the council and damages were awarded to the company amounting to £49 million. As my hon. Friend pointed out, those damages were exacerbated by certain actions.
In January, the council applied to my Department for a supplementary credit approval, to release £15 million of invested capital receipts. Under the capital finance system, that money can be used only with a credit approval. We have a firm policy of not issuing SCAs outside certain specific, targeted programmes—for instance, for reorganisation costs. Outside those programmes, SCAs can be given only in the most exceptional circumstances.
We considered Welwyn Hatfield's case extremely carefully, but we concluded that there was insufficient justification for issuing an SCA. Consequently, we turned down its application. Such an approval would lead to an increase in the public sector borrowing requirement. In order to meet our objectives for the public finances, that would have to be balanced by increases in Government revenues from taxation.
My Department gets a number of requests for SCAs each year from authorities facing unplanned demands on their budgets. If we gave way in the case of Welwyn Hatfield, we would be expected to do so in other cases. There would be substantial public expenditure consequences if we met even a proportion of the applications.
My hon. Friend has, however, offered an eminently sensible suggestion—large-scale voluntary transfer of the housing stock. It is a well-proven scheme, which works extremely well and is extremely successful and popular. LSVT increases investment and improves the condition of the existing stock in every case. Housing transfers are not rare, although Welwyn Hatfield council might say that they are, nor are they exotic or an emergency measure. They are becoming a normal, common, well-recognised way of meeting requirements in housing for tenants, with tenants' consent. They are accepted by authorities and councils of all political complexions.
Housing transfer is not just a solution for now, but provides long-term benefits for the future. Public expenditure will always be limited. Housing authorities will never be able to spend as much as they might like in repairing and improving their stock. Private finance is not subject to the constraints of public expenditure. LSVT provides a stable financial future for the upkeep of tenants' homes.
Under the new Housing Act 1996, a local housing company can be set up as the new social landlord to own the stock, in which both local authority and tenants can hold substantial stakes.
Since 1988, 53 local authorities have transferred their stock, generating more than £3.7 billion in private finance. To borrow a saying, "Watch my lips: more than £3.7 billion in private finance." Receipts generated from transfers under the 1997 LSVT programme are expected to be around £350 million, involving 17 local authorities.
Last autumn, we introduced measures that included a three-year holiday from the 20 per cent. LSVT levy that is normally charged on transfers. Welwyn Hatfield is debt free. It no longer has to set aside any of the proceeds from future sales of assets. It would, therefore, have available 100 per cent. of the receipts from the transfer, including the extra 20 per cent., if it transferred within the holiday. The council would not need to touch its invested capital receipts and it would continue to receive the interest on those investments and on anything left from the transfer receipts.
We have increased the size limit for transfers to any one landlord from 5,000 to 12,000. Those such as Welwyn Hatfield with a stock below 12,000 would, if they so wished, be able to negotiate a transfer in one single action, thus saving on administrative costs and keeping the tenants together under one landlord. Tenants like LSVTs because of the benefits that they bring: for example, an accelerated programme of catch-up repairs; guaranteed rent levels for up to five years; much better management—in this case, much, much better management; and closer and real tenant involvement in management.
For the obvious reasons cited by my hon. Friend, transfer would be a sensible policy for Welwyn Hatfield. In fact, it would be sensible irrespective of the court case, in the present circumstances, because transfer brings private investment to the stock and generates resources for the council, which it could use for the benefit of its tenants and the local citizenry.
Labour Welwyn Hatfield has got itself into a corner and that is its own fault. The council now has a way out, which has been suggested by my hon. Friend. I congratulate him on championing the cause of his people, his residents, his citizens and his council tax payers. I only hope that, for a change, the councillors take the very broad hint that has been laid before them by their Member of Parliament.
Question put and agreed to.
Adjourned accordingly at twenty minutes to Seven o'clock.